Investing Guide - Mutual Funds
Mutual funds are an investment that allows a group of investors to pool their money and hire a portfolio manager.
Instead of looking at whether to buy stocks, mutual funds, fixed deposits or other forms of investment, what is more important is to first adopt a planned or a goal-based approach to investing. Investments should be made according to each goal and monitored till that specific goal is achieved.
To go about building the desired corpus. Two things are very critical here, regardless of our goal:
Starting to invest early for your goals is critical, as any delay in investing can negatively impact your cash flows in a big way. The key elements are starting early and having a planned approach including proper asset allocation.
For example, one needs to save Rs 11,000 per month (assuming returns of 10% per annum), starting at age 30 to build a desired retirement corpus of Rs 2.5 crore. This increases to about Rs 33,000 per month if we wait till age 40, and Rs 1.21 lakh a month if we wait till age 50 to start investing; for building the same amount of retirement corpus.”
To start investing in a fund scheme you need a
:- PAN Card
:- Bank Account
:- KYC (know your client) Compliance.
:- The Bank Account should be in the name of the Investor with the Magnetic Ink Character Recognition (MICR) and Indian Financial System Code (IFSC) Details.
These details are mentioned on every Cheque Leaf and it is common for an agent or distributor to seek a cancelled Bank Cheque Leaf.
Investing in the Stock Market can be done primarily in 2 ways - investing directly into well established Stocks with good proven records and investing into a mutual fund that is again investing into good stocks. Investing into Stocks through either approach requires regular monitoring and portfolio cleansing. Catalyst Investing aims to arm the individual investor to make these investment decisions on his own by understanding the principles behind successful Stock Investing.
Equity mutual funds (MFs) have the potential to provide higher returns vis-a-vis most other investments over a period of time. But due to higher risks involved in getting these returns, equity investments should be chosen for long-term goals, which are ideally more than 5 years away. Equity MFs are one of the best ways to invest for the long term and all investors should consider equity as part of their investment portfolio.
Let’s look at retirement, the most important milestone in a person’s lifetime. Why it’s the most critical is the fact most of the working class population has longer life expectancy and nil social security benefits.
Did you know that with the advancement of medical science the time we spend in retirement will be almost the same as the amount of time we spent earning? We typically spend 30-35 years of our life earning
Here is a different way to look at the same concept: if your monthly expenses are Rs 50,000 today and you are 40 years of age, your expenses will increase to Rs 1.33 lakh per month at 60 years, assuming an inflation rate of 5% per annum. Even during retirement, the impact of inflation will mean that your expenses keep growing every year and will touch Rs 2.16 lakh a month at 70 years and Rs 3.52 lakh per month at 80 years.
The Intelligent Investing Intensive program (IIIP) is about taking control of your investment decisions and not being dependent on anyone else. The course aims to equip you to do goal based investing. Financial planning sits at the heart of the program which enables you to identify your goals and invest for each according to the time horizon. The course enables you to identify safe entry-exit points from the market which helps you increase your returns further.
During the program, we show you how to analyze the past trends and how to understand the market behavior for your investments. During this course you would be accustomed to regular monitoring of your portfolio and what this involves. Thus, we can together analyze and curate our investments for Long-Term Growth
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