How Family Farmers Can Do a Good Job of Family Financial Management

With the development of family farms, many farm owners can earn a net income of tens of thousands of yuan a year, or even hundreds of thousands of yuan, which makes others envious. But many people hold spare money and do not know how to manage it, and saving in the bank is their only investment option. So how should they manage their finances? Let's look at the advice given by experts.

[Case]:

Uncle Liu is 55 years old and a farmer in the Chongming area of Shanghai. He has contracted several vegetable greenhouses and also raises Chinese mitten crabs. Last year, Uncle Liu's net income reached 250,000 yuan, which is enough to make many city dwellers envious. At present, Uncle Liu's family has been contracting for more than 5 years and has saved more than a million yuan from it. Uncle Liu has one child, who is currently attending university. How can Uncle Liu help his family increase its income through investment and financial management?

[Advice]:

Based on Uncle Liu's family situation, the experts provided the following advice, as follows:

1. Set aside enough funds for production and daily life

First, Uncle Liu should reasonably arrange funds for the family's current daily life, reserve funds, preparation of funds for production operations, and so on. This part needs to be set aside. The rest can be used for investment. Investment terms can be divided into three types: short term, medium term, and long term. Short- and medium-term investments can provide better liquidity, while long-term investments can better increase wealth.

2. Diversify asset allocation

It is suggested that Uncle Liu's family investment is best carried out in a diversified way, spread across 3~4 projects for asset allocation, and it is recommended to do so through indirect investment. It is not advisable to intervene too much with direct investment in unfamiliar fields.

3. Allocate short-term and medium-term investments

For short-term investment, it is suggested to consider some bank wealth management products, such as products invested in money market instruments. Their returns are relatively stable, averaging around 4.5%~5.5%, the investment threshold is only 50,000, and the investment terms range from 1 month to 12 months. In addition, some securities investment plans can also be allocated. Uncle Liu's family is quite suitable for both of these short-term and medium-term investments, and the investment share can be kept at around 20%~40% of investable funds.

4. Buy suitable commercial insurance

Uncle Liu has only one child, so old-age support will become a serious issue in the future. To reduce the family burden, in addition to basic protections such as the New Rural Pension Scheme and the New Rural Cooperative Medical Scheme, within an affordable range, Uncle Liu can appropriately buy commercial insurance such as critical illness medical insurance for his family, strengthen old-age support, and also reduce family financial risks.

Xu Pei