As we look forward
to an amazing year ahead, this can be a great time to revisit and reflect on
your procurement portfolio. Here is a simple 7-point checklist… Check 1: Do you
have an emergency fund to tide you through emergencies? The recent
covid crisis is a good reminder of the importance of an emergency fund. Salary
cuts, Job losses, Medical Expenses, etc can come out of nowhere. Make sure you
maintain at least 6-12 months of your Monthly Expenses Safe Debt Fund or Fixed
Deposit Check 2: Is your current asset allocation mix in line with your
original plan? Given the recent equity market rally, there is a good chance
that your equity allocation is much higher than your original planned asset
allocation. If your equity allocation exceeds your original asset allocation by
more than 5%, it’s a good time to book some profits and realign them back to
the original allocation. For Eg: Assume you have a long-term asset allocation
of 70% Equity:30% Debt. Right now say if the asset allocation has drifted to
77% Equity:23% Debt, this is a good time to sell some equities (i.e 7% of Total
Portfolio) and shift to debt. This will bring back the allocation to the
original intended 70% Equity:30% Debt allocation.