Investment Ideas & Tips For Beginner Investors – Axis Direct
Apr 16, 2019 | Source: www.timesnownews.com
4 Questions To Ask Before Investing In Mutual Funds
Saving and investing are the most important tasks to manage your finances in a better way. But it differs from people to people. It is advisable to start saving once you get your first job. The early you start investing and saving, the more time you get to build a larger corpus. One should develop the habit of saving and investing in a planned way.
Do not take your financial independence for granted. Learn the importance of saving. In order to grow your wealth, understand the basics of finance. Here are the five tips people should consider before investing for the first time-
1. Investment goal- One should be clear with the investment goal before investing. The clarity in the purpose of investing helps to invest in a planned way. One should outline the long-term objective of investment. It is also important to understand the basic difference between various asset class such as equity, debt instruments, etc. One should be clear with the exit strategy as well. If you find any difficulty in planning and saving then try to take guidance from the financial advisor before you start with your investment.
2. Start investing early- Starting the investment process early helps you to build a bigger corpus. It is advisable to save and invest at least 15 to 20 per cent of your income. At the early stage of your career, people do not have a higher salary. But still, they should think about their long-term goals and then plan accordingly. Keep a track on your income and expenses. This way you will able to plan in a better way.
3. Do not afraid of taking risks- Risk is often involved when it comes to investing. One should not afraid of taking risks in order to achieve financial goals. Most of the investment tools come with an element of some risk. It is important to manage your risks as well. Once you start investing try to figure out your risk appetite.
4. There's nothing like quick success- People who start investing for the first time are often fond of quick success. They find the option of EMI quite convenient. As EMIs make any luxury item look within the reach. But one should try and understand that spend only on the necessary things or else you will end up in a debt trap. Investing can be started with as low as Rs 500 a month even. Instead of buying some unnecessary thing in EMI, consider investing the same value in mutual funds via SIP route.
5. Start building an emergency fund- It is important to have an emergency fund. This contingency fund should have an amount equal to six to nine months' of household expenses. This fund is helpful at the time of urgent cash.