Investments: Sooner the Better

by Akankshaa S. Financial Advisor

We all eventually at some point get started with formal earning from the job we land up in. It may be a well-paying job or a one with meagre salary to fall on. But what we don’t fail to do is spend in whatever little we have in order to have some fun or fulfil our day to day needs. The reason may be whatsoever; but do we also invest that earnestly?

We all have various financial aims to accomplish; owning a house, buying a car or planning a foreign vacation may be. All these to fulfil may seem to be tedious task but not if it’s well organised and scheduled. SIP or systematic investment planning is a way through which you can invest in mutual funds making small and periodic instalments. You can start with as low as Rs. 1000 a month and also select the period of the instalments; a minimum tenure of 3 years is recommended.

Why is SIP a Smart Choice?

· It helps in building financial discipline by making investment your first priority as oppose to it being your last priority.

· Reduces the risk factor involved with investments by giving out an average of investment.

· Helps in compiling your wealth. Getting wealthy isn’t a tough job with this simple formula by your side: Start Early + Invest Regularly = Create Wealth

Create Wealth

Invest Regularly

Systematic investing has a compounding effect on your investments. In the run an amount as small as Rs 1000 a month for investment swells up to a huge corpus.

Start Early

We have discovered the magic created for your investments by the power of compounding. Similarly starting your investments early also has its own advantages. It’s a very simple logic if you begin early simply means the power of compounding starts acting earlier on your money too. Thereby helping you yield higher returns.

Now that we have realised the importance of investments and the benefits it comes with of starting early in life. Let us have a look at the various investment options and their aspects. Mutual Fund NAV is one such aspect of finance that acts an indicator of the market value of the funds units. Therefore tracking the performance of the mutual funds you have invested into. It helps the investor to gather accurate information about the investments by studying the NAV movements of a certain fund over a specific period time.

Many investors assume that investing money in mutual funds with a lower NAV may reap them better returns compared to a mutual fund with a higher NAV. However this is a misconception and investors end up putting money in under performing mutual funds. Low NAV of a mutual fund is more of indication that the fund was either floated recently or possesses a poor performance and return history.