Every individual has financial goals they strive to achieve. In order to turn the dream into a reality, it is important to take steps that will help you reach there. Wealth will never grow overnight. It is essential to take small, but steady steps that will help you make the right investment decisions and move closer to your goals.
Investing in mutual funds is considered as a safe investment due to the low risk-high return trade-off. An investment in mutual funds remains diversified since the fund managers invest the sum into different securities. Additionally, there is the benefit of compounding interest that generates higher returns in the long run.
In spite of knowing about the benefits of investing in mutual funds, the one common excuse amongst most investors is the lack of funds to invest. Here are some factors to keep in mind that will help you invest even from your limited income.
- Start small
In order to achieve your long-term financial goals, the first step is to start saving. If you think you do not have enough to invest, you may start saving small amounts each month. This may be made easier by making a list of all the expenses you incur each month and try to cut down on the ones, which are avoidable. For instance, if you watch a movie in a multiplex every alternate weekend, bring it down to once a month. Similarly, if you have a tendency to buy random goods online, get rid of the habit and purchase things only when you need them.
- Invest regularly
The next step is to invest right. Once you have saved some money, ensure that you invest it into an appropriate fund before you end up spending the amount. Make the right investment choices based on your current financial position, risk-return appetite, and your long-term financial goals. Treat the investment as a regular outflow of cash each month and do not end up spending your entire salary. Buy mutual funds online based on your knowledge of the fund performance or seek advice from the fund manager to help you pick the right fund.
- Set up a systematic investment plan (SIP)
Investing in mutual funds is easier with an SIP. The good news is that in order to invest in mutual funds, you may start with an amount as low as INR 500. An SIP will automatically transfer a fixed predetermined amount from your bank account to the fund. You will not have to organize the investment and it will bring financial discipline into your life. With an SIP, you do not need to time your entry into the market and the volatility of the market may be smoothened out. As your income increases, you may increase the number of SIPs each year and grow your corpus.
Investing in mutual funds should be a long-term process in order to generate higher returns. All you need to do is start saving and pick up a fund with a higher long-term return. If you have the knowledge of market movement and performance of the funds, you may buy mutual funds online.
The Angel Wealth mobile application offers customized recommendations based on the requirements of the investor. It features an ARQ investment engine and is free of human bias. The user-friendly app will help you make the right investment choices and allow you to invest anywhere, anytime!