Stock Market: In a volatile stock market, you must create a cushion for financial goals: Here's how to do it

Protect your financial goals
Market moods can change rapidly and torpedo your critical financial goals if you are not protected. Goals are planned on the basis of certain assumptions, and if these go wrong, the final outcome can be very different from what you were expecting. Therefore, building an adequate buffer is the best way to protect your goals from market vagaries.
How much do you require?
"As a thumb rule, a cushion of 15-20% of the future goal value is enough," says Amol Joshi, Founder, PlanRupee Investment Services. For instance, if you have estimated a need of Rs 20 lakh in 10 years, invest in a manner that you earn at least 15% more, which would be Rs 23 lakh in this case. Even if the assumed return or inflation stray off the mark, you will be able to meet your goal. There are several rules that define how you calculate the size of your cushion.

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