When it comes to investing people always find excuses to avoid it some most common excuses are lack of money, lack of knowledge, too early to start and risky investments. Lets disuss how you can start with little money for investment
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Start Early- we can’t define a proper age for investment. There is no perfect age to begin saving, but the sooner you begin, the better. Over time, even modest contributions can add up to significant sums of money. That is when the force of accumulation comes into play. The longer you spend, the more your money grows and the more your returns grow.
Follow SIP approach- Don’t attempt to predict the market with large sums of money. That is putting too much pressure on your money. Instead, go with the security of a well-thought-out financial strategy. It synchronizes with your inputs and also provides the advantage of rupee cost averaging.
Use Mutual Funds-That leads us to the next question: where should you invest a modest amount of money? Obviously, if you place the money in a liquid fund that pays 6% pre-tax or a debt fund that pays 9%, you will not be able to build significant wealth with a modest expenditure. You should invest in stocks over the long run. Don’t be taken in by industry and theme funds. In downturns, they can be too dangerous and useless. Stick to diverse equity funds and, at most, multicap funds if you want to profit from alpha from midcaps and smallcaps.
Focus on Quality stocks in small quantities- If you believe that purchasing direct stocks requires a large expenditure, reconsider. You can even purchase a tiny quantity of a stock when you buy shares in demat. A share of Infosys costs less than Rs.750, while a share of SBI costs around Rs.300. You can continue to nibble in tiny amounts. Remember this market legend: a Rs.10,000 stake in Wipro in 1980 would be worth Rs.600 crore today. Yes, you heard correctly!
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Put Trading Limit for options- Even if your corpus is tiny, you can always search for alternatives. You can assume a bigger stake in calls or puts where your conviction is stronger. Of course, retain the premium as a deferred expense and proceed. Assess your risk tolerance, but this is a fantastic method to play the market both ways.
Best Invetsment plans in India in 2023
1. Stocks
2. Mutual funds
3. Senior citizen saving scheme
4. Public Provident Fund
5. NPS
6. Real Estate
7. Gold Bonds
8. Crypto
9. Life insurance
10. Bonds
Conclusion
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Best investment plans will help us in creating wealth without worrying against uncertainties. It will provide you retirement savings which will serve as a source of income post retirement. You have to make a budget to start saving immediately and determine the financial goals. Start saving in early 20s by building an emergency fund makes contributions in PPF account or NPS. Start saving for your retirement and also invest a portion of your savings in to long term investment opportunities.
