Timely and Smart Investments Can have Lasting Positive ImpactsShowing a strong surge in retail investor interest, mutual fund industry has seen the number of its new Systematic Investment Plans grow by 18 per cent to 73 lakh at the end of March 2015, according to an article published in NDTV profit in April 2015. Mutual funds investments are considered to be one of the most contemporary, low-cost, hassle free, transparent and regulated products that help to deliver superior returns as well as save taxes. It is managed by the expert fund managers who have years of expertise in stock markets.
How to Invest SmartlyIndians have traditionally adhered to invest in gold and fixed deposits in order to grow their wealth. Being high on risk, stock market investments also offer higher return. Although insurance maybe a great product that offers financial cover in times of need but it is not enough. With rising inflation and changing lifestyle, it is essential to plan your financial future in such a way so that you are able to maintain your standard of living. Building wealth is one way to do so. When you invest, your money helps you earn money. Here the top steps to help your wealth grow.
1. Start Early – Warren Buffet who is considered to be the most successful investor of the 20th century bought his first stock at a tender age of 11. The push behind why to start early is because compounding is at play. The more time you give your investments to mature, the more you reap.
2. SIP – SIP or Systematic Investment Plans lets you follow a discipline in investing. You can invest small amount of money under SIPs. Investing in a good quality mutual fund in India through SIPs is one of the surest ways to ensure that you do not miss on investing and remain regular. With increase in income, you can increase the monthly investments over time.
3. Long-Term Investing – One of the golden rules of gaining from investments is investing the smart way. Often investors withdraw their money from a certain fund too soon to give it time to grow and reap returns. Invest your money in any fund on long-term basis.
4. Review Regularly – Review your investment portfolio regularly. See how a certain fund is performing. Also, withdraw your money from a fund if it has not been consistently performing poorly.
5. Understand your Investments – It is not wise to park your money in any mutual fund that you have heard of. Analyze the fund yourself, assess its past performance, understand the risks and then decide whether to invest in it.
In order to choose an investment strategy that works for you, you need to analyze your risk profile. The younger you are, the more you can afford to invest in risky ventures. Over time, when you develop confidence in your finances and have begun to meet your goals, you can choose to bifurcate your investments into those that yield fixed returns. If you follow these tips on smart investing, you will be well equipped to ride the bull into financial stability and a secure future.