It is good to have investments driven by a purpose. A financial goal sets the agenda for an investment. Ask yourself why you are considering investing. Is it to build a retirement corpus? Save for your child’s college education? Buy a car or a house? Depending on the goal, you will be able to choose the right combination of investment avenues to help you achieve the goal.
For long-term goals like retirement and child’s marriage, a combination of insurance saving plans and equity mutual funds can work well. But, if your goal is saving Rs 2 lakh for the car loan down payment in the next 15-18 months, fixed income can be your best bet. Go for short-term debt or liquid mutual funds that can help you in this.
Some may have goals that have two objectives like tax-saving as well as wealth creation. Such a goal is best served with tax-saving mutual funds and plans in the life insurance space. Want to know more? Check out Standard Chartered’s comprehensive wealth solutions by clicking here.
How much risk can you take? The usual answer to this question is subjective. But it is important to know what your risk tolerance is before you start investing. It’s like using smartphones. You are either an Android lover or an iOS aficionado. Similarly, risk tolerance is a specific measure. Are you okay with a 20% loss in a day? Are you okay if your investment drops by 50% in a year? Are you OK with losing practically your investment portfolio over a period as long as you get high returns later? Or, are you totally uncomfortable with loss however short-term it be? Answers to these questions will tell you about your risk taking capacity.
If capital protection, i.e. zero loss on original investment is your risk taking level, you should not venture beyond bank fixed deposits and recurring deposits. It shows you are a conservative investor. Is that you? Book term deposits with Standard Chartered. Learn more. There are also safe insurance saving plans that give you guaranteed returns, without exposing your money to any risk. Enjoy the benefit of the safest savings returns in such insurance plans, with an added benefit of life cover.
If you are okay with taking slightly more risk, you can try debt funds. These are mutual funds that invest in fixed income assets. They offer no principal or interest rate guarantee, but can generate returns more than bank FDs, while also being more tax-efficient than them if you hold on to them for more than 36 months. To enjoy seamless investing and get top debt fund ideas with Standard Chartered Online Mutual Funds platform, visit this link. It has all the information about how the offering works and what’s in it for you.
There are many individuals who love taking risks. But even for such brave investors, diversification is an important tool. For individuals the risk is not in investment loss; it is actually the situation where your financial goal is not attained in time. You may invest in direct equities or high-performing equity mutual funds or wealth creation plans offered by insurance, but do remember to spread your investments across. Diversifying helps shield your portfolio from major downward swings whenever any particular sector or category performs poorly.
Firstly, distribute your total investments in a proportion across different options like FDs, debt funds, equity mutual funds, etc. Secondly, use the systematic investment approach so that your investments can take the benefit of rupee-cost averaging over a period of time. In this way, your money is invested at different points in time and is not concentrated at one fixed time period.
To gain insights into the economy and different asset classes, do some reading on what experts are saying. An easy way is to catch the ready-made insights provided by Standard Chartered’s specialists. Read the latest insights here.
Most of your financial goals depend on your investments. If you invest say, Rs X, you might get Rs 2X or multiples of that over a set period, provided there are gains in your portfolio. You can also invest the amount slowly but regularly. However, all these plans are excellent only as long as you can maintain the discipline or have enough money to do investments.
Life is unpredictable. In the fast-paced world, it is important to be prepared for all eventualities. The uncertainty of life is what makes insurance a key component of any investment plan. Insurance ensures that your financial investments can reach their desired outcome even when there are no further monetary inflows. Think of insurance as a small price to secure your cherished dreams. The most affordable types of insurance include term cover. For a small amount of annual premium, this type of insurance policy gives a significantly large cover. In case you meet with an unfortunate incident that results in your death before your goal is fulfilled, the term insurance will pay your nominees the insured amount. It is that simple! Just like you are reading this online, you can also buy insurance plans online. Calculate your financial needs by using this calculator.
As you can see, learning and planning your investments is very important. All this has to be done before you eventually invest. So, spare some time out of your busy schedule to learn the tricks of the trade. Reach out to Standard Chartered if you need any assistance.
