All through your adult life, you may have been conditioned to believe that spending is bad. While there may be some truth to this line, it’s not always the case. In fact, there are some expenses that can actually be financially beneficial for you in the long run. These expenses can help you in different ways. Some of them increase your asset holdings, others reduce your financial liabilities, and yet others may help secure your loved ones financially even in your absence.

So, what are these expenses? And how can they benefit you? Let’s find out.

5 expenses that can benefit you in the long run

Here are 5 such expenses that may improve your financial status and make you more financially independent with time.

1. Life insurance premiums

Life insurance is an important financial product. It can secure the financial independence of your dependent family members in case something untoward happens to you. However, many people put off purchasing a good life insurance plan due to the misconception that it may be an unnecessary expense.

The truth is, life insurance is an essential financial product that can be extremely financially beneficial in the long run. It allows your loved ones to lead a secure and comfortable life as planned, without any hassle. So, it’s advisable to make some room in your monthly or annual budget for life insurance and secure your family’s future at the earliest.

2. Home loan EMIs

Home loans are a long-term financial commitment. However, if you have the right financial plan in place, your home loan EMIs can be advantageous expenses that you take on today, so your asset portfolio increases tomorrow. Purchasing a house can help reduce rental expenses in the long run.

Furthermore, when purchased as a saleable asset, you can even make a lucrative profit by selling the property at a later date for a decent sum. This, in turn, leads to capital gains on your asset sale. So, a house property can be a beneficial asset to own, because it can either bring in gains or reduce your monthly expenses over the long term, depending on the use it is put to.

3. Investment outlays

Investments need not always be made as lump sum amounts. You can also start a Systematic Investment Plan (SIP) and invest small sums of money periodically in the asset or scheme of your choice. Needless to say, these are among the most beneficial financial outlays you can include in your budget.

When you’re drawing up a monthly budget for your personal finances, try and prioritize your investment-related expenses. This will allow you to create a corpus earlier in life, thus making the journey of wealth creation much easier and faster.

4. Expenses to improve financial literacy

Whether you wish to make an investment, borrow money or purchase life insurance, financial literacy is crucial. Without understanding the fundamentals of personal finance and the finer details of how various loans, investments and insurance plans work, it can be nearly impossible to chart out a financial plan that is beneficial for your specific requirements.

Spending a small part of your monthly income to improve your financial literacy can be a beneficial idea. You can subscribe to podcasts, newsletters and even enroll in courses that will give you a better idea of how money works, and how to make your money work for you.

5. Expenses incurred for expert financial assistance

Sometimes, even armed with all the financial knowledge needed to create a financial plan, you may require expert assistance. This could be because you just sold a property and need tax planning assistance, or because you want to reduce your debt but have no idea where to begin. Financial planners can help you with these concerns. And the expenses you incur as fees paid to these experts could well be worth it.


While these expenses can be beneficial, keep in mind that they are still fundamentally financial outlays. So, ensure that you prioritize these expenses when you are drawing up your monthly budget. That way, you can focus on building your wealth, reducing debt and creating value with additional assets in your portfolio.

That said,  make sure you only take on the expenses  that you can actually afford. For instance, if your budget can only accommodate the premium for a life insurance policy at the moment, it is best to check off that life goal and wait for an increase in your income to meet other goals like buying a house. If you need further help with this kind of financial planning, you can always approach a financial expert for assistance.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.