Checklist for beneficiaries /end users

To understand housing/sanitation need

One needs to answer few questions before deciding on investing on housing or sanitation infrastructure:

  1. Understanding need for sanitation/housing: understand the need of your investment or saving? Owning a house is matter of social security, dignity and pride, similarly having own sanitation unit is a matter of privacy, dignity and well- being for the whole family especially women of family. Homeownership can offer many advantages including tax benefits, financial security and pride to own a house. However analyse if you really need to buy house or you are happy with rented house.
  2. Analysing affordability for Housing/construction for sanitation Analyse all your liabilities and expenses along with income sources. Can you afford monthly instalment with the rent you pay and you have sufficient savings possibilities. Are there options for you to increase family income to afford monthly instalment for long time. How stable is your monthly income and how that can be increased with supplement income or savings.
  3. Incremental construction or progressive housing /Building in stages: You need to plan for construction as per Family’s available disposable income deducting all debts, liabilities, expenses and taxes. You can also plan for incremental construction or construction in stages, for which HFH India construction team can be contacted. The construction plan has to be thoughtful, technically sound and fit to budget and therefore, consultation of field expert is important.
  4. Analysing Credit abilities: Try to understand your credit abilities, some banks and financial institutions do it free of cost. This will also help you to determine down payment for house buying or loan amount.
Tool for beneficiries to reach financial goal for sanitation/housing

There could be 10 steps to reach financial goals by client or beneficiaries:

  1. Set financial priorities: Take a while and understand your life style and spending pattern. Analyse what affects your spending and financial decisions and what are actual life/ family priorities.

  2. Get organised: Keep a track on your financial investments and savings along with daily check on income and expense. Keep a file for all financial documents like bank statement, credit card information, investment information, insurance policies, will papers etc., which is accessible, fire proof and safely secured. Some documents can be kept in safe deposit box at a bank for more safety like , birth certificate, death certificate, marriage license, divorce papers, copies of will etc.

  3. Track your money: Control your financial situations and expenses. Manage your bank, credit card expenses statements with actuals on a notebook.

  4. Shop smarter:

    • Make list of shopping trips and stick to needy items to avoid impulse purchases.
    • Use cash for purchase instead of credit or debit cards and buy only for cash you have
    • Buy from generic store brands at supermarkets.
    • Compare prices and look for sales and off season bargains
    • Buy in bulks, it saves money but don’t buy more than you realistically use

  5. Review and reduce your debt: Total consumer debt should be less than 20 percent of your net income. Consumer debt includes credit card payments, car loans, student loans and any other debts that you repay monthly, and does not include money spent on a mortgage, rent, utilities or taxes. Use these calculations to assess your debt load.

    My yearly net income after taxes and deductions is Rs.——————-

    My monthly net income is Rs.——————(yearly income divided by 12).

    According to the 20 percent guideline, the amount of consumer debt per month that I should not exceed is Rs.——————-(Monthly income x 0.20).

    Combine financial planning with debt management techniques to reduce your debt by implementing the following tactics:

    • Create a get-out-of-debt plan. Calculate how long it might take you to pay off your debt.
    • Cut expenses. Try to identify a few things you could stop buying or buy less often.
    • Get a second job/income source. Try to increase income. Is it possible to get a second job or overtime?
    • Prioritize debts. Pay off the highest interest rate debts first and move funds to the next when paid off.
    • Shift higher-interest loans to a single lower-interest loan.
    • Stop running up new charges.
    • Keep only one or two major credit cards and consider having the limits lowered.
    • Set your goal. Each month, I can afford to pay around Rs.———————–for my consumer debt.

  6. Build a strong Credit Report: Your credit report is a record of how you’ve paid your debts in the past. It shows the current amount of debt you have, and how much debt you’ve repaid. Maintaining a strong credit report can help you in a number of ways. Always pay your instalments/ bills on time. Use only 1 or 2 cards.

  7. Save for your future: Saving money is not easy, but it is essential to achieving financial well-being and securing your future. One of the best and easiest ways to save money and start a strong retirement income planning program is to pay yourself first. Every time you receive a pay check, save a certain percentage of your income before spending money on anything else. You may choose to have your bank automatically transfer a certain amount of money from your account to your savings each month.

    The Time Value of Money: The earlier we start saving, the more interest can be earned Saving Versus Investing: Investing carefully is more lucrative and earns profit than only saving. Invest only in registered entities. Saving for an Emergency: Emergency fund should be saved to meet exigency situations may be to cover basic living expenses for three to six months.

  8. Set Financial Goals: Set Long term, medium term and short term financial goals: Try to set SMART goals. These are goals that are Specific, Measurable, Achievable, Realistic and Time-Bound. Make sure you prioritize your goals. Which ones are the most important to you? Work toward achieving these goals first.

  9. Create a spending Plan: Putting your financial goals in writing can make them more concrete and achievable. However, it’s easy for everyday purchases and obligations to get in the way of saving for the future. One of the best ways to make sure your daily spending habits don’t overwhelm your life goals is to create a spending plan. A spending plan is not meant to be a strict budget. Instead, it’s a guide that will help you take control of your financial future and, ultimately, reach your goals.

  10. Invest money to reach your goals: Once you’ve identified your financial goals and established a spending plan, you know what you’re saving for and how much you’ll need to get there. For longer-term objectives, investing is one of the best ways to watch your money grow. When you invest, you put money aside for long-term goals such as retirement or a child’s education. The easiest way to do this is by having money automatically deducted from your bank account or paycheck and put into the investment vehicle of your choice.