After going through job loss and wage cuts through the pandemic interval, it’s time for a wage hike. Following a gentle normalisation of the COVID-19 state of affairs – after the withdrawal of wage cuts and enchancment in job market – corporations are giving due value determinations to their workers once more.
While restoration of jobs and full wage offers respite to the affected workers, value determinations would supply a lot wanted motivation and some extra money to counter excessive rate of inflation.
However, aside from eradicating the curb in spending and spending some additional out of the elevated a part of the wage, one must also save and make investments from it to make provisions for future contingencies and improve in expenditures as a result of inflation.
“One of the best moments in the life of a salaried employee is when he gets a salary hike. Normally, the younger generation likes to celebrate the occasion with their friends. Nothing wrong with getting momentary gratification for a year of hard work, but it is always prudent to rejig your investment portfolio with every increment,” stated Vijay Singhania, Chairman, TradeSmart.
Apart from making provisions for contingencies and countering inflation, it’s additionally necessary to speculate for meeting the longer term life targets.
“The incremental money should be immediately assigned to a goal to multiply your wealth. It can either be allotted to reducing your liability or invested in instruments like Stocks, Exchange Traded Funds (ETFs), or Public Provident Fund (PPF) that help you in achieving an important life goal,” stated Singhania.
While the value determinations would supply more money within the palms of the workers, some a part of it will be eaten up by taxes, except tax-saving choices are exercised correctly.
“One needs to consider that an increment comes with a baggage of higher taxes. In such a scenario, the individual needs to plan his investment in a tax efficient way,” stated Singhania.