The first week of the new year is as good a time as any to start thinking about financial goals for the medium to long term. It is immaterial whether you have just joined the job market or are on the verge of retirement or are leading a healthy pensioned life. You need to periodically clean up your investment portfolio, get rid of the non performers and buy into financial products which deliver results that are in sync with your future needs.

Here is an evergreen list of basics that comes in handy on the first day of your job and also on the last day of your working life:

Firstly, a good health insurance plan is a must. Such a plan should run parallel to your company-provided health cover, which is mostly a generic coverage of basic ailments and, God forbid, accidents. There are way too many examples of employees shelling out hard earned savings to meet an unforeseen medical event because the same was either partially covered by the private employer's health plan or wasn't covered at all. The earlier in your career you start with your own health insurance the better it is. An independent health cover is gaining more importance these days when the corporate world is downsizing rapidly. You do not want to be in a position to hunt for health insurance at a time when you are without a job. That time is better spent on hunting for a new employer. 

Buying a health insurance policy has its own checklist. A wholesome policy should provide ample coverage in terms of money, should keep pre-existing diseases in mind, should be cashless when used, an annual bonus should be paid if not encashed during the year and its exclusion clauses and critical illness riders should be in favour of the purchaser, not the insurance company.

Term Insurance should be your second port of call. While Indians are among the least insured globally, a vast majority of us have low paying investments masquerading as life insurance plans. These were sold to us by friends and relatives when they started out as insurance agents. In fact, a majority of the ULIPs have huge yearly management fees which leave little corpus for investments. So, if you have dependents to be taken care off financially in your absence, you need to buy adequate term insurance to help them tide over at least 5 years after your sudden departure. So, ideally your term insurance should provide coverage worth 4-5 years of your annual income. Buy such an insurance online because that's the cheapest route.

Both medical and term insurance purchases require a health check up.

Once these two steps are out of the way, you need to work towards building a retirement corpus with the least amount of work and effort. To this effect, buy a simple diversified equity fund via the SIP, or systematic investment plan, route. Listen to no one who talks about when such a fund should be purchased. There is no wisdom in timing the market and no one knows where the markets are headed in the short term. The best day to start such a SIP is today. 

Equities, especially in growing economies like India, are the best route to create financial wealth in the longer term. They offer inflation-beating returns, are tax-free post one year of holding and compound earnings and investments over the longer term. Several Indian mutual funds are more than 20 years old now and they have given compounded returns of 23 per cent each year over the past 2 decades. 

You need to simply put in a monthly SIP in a equity fund. Stick to this investment for 30 years and you will be pleasantly surprised by the corpus it creates for your retirement. Do increase the monthly amount each year by between 5-10 per cent that reflects your annual increment. Reams have been written on when a fund should be purchased, but what matters in the long run is how much time you have spent in the market rather than timing the market. Well managed equity funds have given returns between 7-9 per cent in 2016, handsomely beating the paltry 2 per cent gain on the main benchmark Nifty. 

Buying a balanced fund is also a good first step into equity markets. A balanced fund invests up to 70 per cent of its corpus into leading stocks and 30 per cent in superb quality long term debt. The returns are comprised of volatile equities multiplying over the long time and interest income from debt cushioning the income when bear markets engulf stocks. A top quality balanced fund has given a compounded return of 21 per cent each year since 1995.

The only two things certain in life are death and taxes. So, its best to plan for both of them sensibly. The government offers tax rebates on certain kinds of annual savings and the best way to ensure the saved corpus generates adequate returns is to invest in a tax saving equity fund rather than into debt instruments such as public provident fund, where returns are below long term inflationary trends. Just put in a simple SIP into a good tax saving fund which has a history of out performance over the past decade. Such returns have varied between 11-14 per cent.

And lastly, avoid credit card debt. This is the single most pernicious element that eats into monthly salaries. By all means use a credit card as a convenience, but never rotate debt. Its best to break a fixed deposit and pay off card debt rather than keep paying the monthly instalment where interest rates range between 20-32 per cent annually.