Why should I invest?
Most of us just have a single source of income, and the fact is we cannot rely on one source. We all need a secondary source, simply because of three reasons. Inflation, Inflation and Inflation.
Some of you may say your savings would help you achieve your goals, but unfortunately your savings are not invested, hence they don’t grow. Most of you might talk about financial instruments like fixed deposits or recurring deposits and how you find them safe. If you calculate the real returns on fixed deposit after considering inflation and taxes, they barely give any returns. The solution to this problem is the capital markets.
Most of you may have heard about mutual funds, stock markets and probably have a very negative opinion about them. However, these instruments are the ones that will help you create wealth and fulfill your financial goals and as interest rates on fixed deposit keep on reducing these financial instruments are going to get more popular.
Some of you may say your savings would help you achieve your goals, but unfortunately your savings are not invested, hence they don’t grow. Most of you might talk about financial instruments like fixed deposits or recurring deposits and how you find them safe. If you calculate the real returns on fixed deposit after considering inflation and taxes, they barely give any returns. The solution to this problem is the capital markets.
Most of you may have heard about mutual funds, stock markets and probably have a very negative opinion about them. However, these instruments are the ones that will help you create wealth and fulfill your financial goals and as interest rates on fixed deposit keep on reducing these financial instruments are going to get more popular.
Guidelines to get started
Avoid wrong advice:
Avoiding taking advice from your friends, broker or any agent who guarantees you that an investment will make money. Take advice from the right people like a financial planner or an investment advisor.
No overnight success:
When you visit a gym, you can’t expect to see results in few days or months. It is only over a period that you see results. Similarly, in investing have realistic goals
Start early:
If you start investing just Rs 1000 every month in Mutual funds from the age of 20 at 12%, you would amass a wealth of 1.1 Cr when you retire at the age of 60.
Start small:
Minimum amount to start investing in mutual funds is Rs 500. Make sure you start off with a small amount and gradually increase that as you gain confidence and experience.
Be updated:
Keep yourself updated on the various happenings in the financial markets. Make sure you track the stocks or mutual fund schemes you invest in.
Don’t sell your good investments:
When the markets are falling make sure you are buying instead of selling your good investments as they are now available at a cheaper price.