Investment
What is Investment?
The money you earn is partly spent and the rest saved for meeting future expenses Instead of keeping the saving idle you may like to use saving in order to get return on it in future . This is called Investment.
Why should one Invest?
One need to invest to:-
- Earn return on your idle resources
- Generate a specified sum of money for a special goal in life
- Make a provision for an uncertain future
When to start investing?
- Invest early
- Invest regularly
- Invest for long term and short term
What care should one take while investing?
(12 important steps to investing)
- Obtain written documents explaining the investment
- Read and understand such documents
- Verify the legitimacy of the investment
- Find out the costs and benefits associated with the investment
- Assess the risk-return profile of investment
- Know the liquidity and safety aspects of the investment
- Ascertain if it is appropriate for your specific goals
- Compare these details with other investment opportunities available
- Examine if it fits in with other investments you are considering or you have already made
- Deal only through an authorized intermediary
- Seek all clarification about the intermediary and the investment
- Explore the options available to you if something were to go wrong and then, if satisfied, make investment
What are various option available for investments?
Investment in physical assets:-
- Real estate
- Gold/jewellery
- Commodities
Investment in Financial assets
- FD with bank
- Saving with post office
- Insurance
- Provident fund
- Pension fund
- Security market-share, bonds, debentures
Types of investment options:-
Short term investment option
- Saving bank account
- Money market/liquid fund
- Fixed deposits with banks
Long term investment option
- Post office saving
- Public provident fund
- Company fixed deposit
- Bonds and debentures
- Mutual funds
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