5 Finance Lessons That Will Help Any Investor

The field of investing is quite a tough one as every investor needs to stay at the top of his game all the time. However, this does not stop potential people from investing their hard earned money in this field. Everybody wants to have a piece of cake! But to generate better results at the end one must be aware of some important financial lessons. 

This blog is an attempt to do this as investors can be better at decision-making when they are aware of some important things. A few financial lessons should be taught in schools or other financial institutions so that people are aware of them beforehand and this will give them a significant advantage over others. Also, it will make them less prone to some common mistakes.

So, let's check out the important ones below!

5 helpful financial lessons for investors

Inflation will exist

Inflation signifies a rise in your current expenses even if your lifestyle remains constant. There have been periods when the rate of inflation in India was in excess of 8% pa. Presently, it is close to 5%. So, the main point is inflation is here to stay.

Saving vs investing

You can set aside a part of your income as savings. However, if you keep your savings as a bank FD or simply in your savings bank account, then it has a pretty lower chance of beating inflation. Experts like Wealthclock Advisors suggest you engage the money in inflation-beating assets mutual fund investments. 

Stay patient in investing

Another important lesson for every investor is, they should learn to stay patient in their business. Many people get swayed by other investors when they boast of their outsized returns and big scores! One should stay patient in their actions and not let emotions get the better of them.  

Mutual funds are quite beneficial

In India, people are still now reluctant to opt for mutual funds as compared to foreign countries. In reality, mutual funds can be a great way to increase wealth and earn handsome returns. Most experts consider them as the best financial investment method available.

Plan the taxes well

Your income can be taxed at a whole rate as and when you earn it. So, if you plan your investments in the right way, you can greatly reduce overall taxes as well as delay the incidence of tax.  

3 Financial Goals That Will Benefit You Later in Life

A lot of us do not invest as we are not sure if there is anything that is worth our investment. The first time we really start seriously thinking about investment is when we have to indulge in saving taxes and someone informs us about ELSS! If you are proactive with your investments, then it can literally benefit you. 

Just imagine the situation when you are not uncertain about money or when you don't worry upon hearing the news of lay-offs! How amazing it sounds when you head to an amazing destination for vacation and there is no loan repayment you have to handle upon coming back? For the more stable ones, how about owning your own home? 

This blog will discuss 3 goals that you can start investing in a straight way. You will realize their benefits without waiting for a considerable time period.  

3 financial goals that will boost your dreams

Invest in an emergency fund 

If you own an emergency fund, then you will be a lot prepared for uncertainty. So, be it family related, job-related or health-related, any unexpected situation must not throw you off. You can handle the financial uncertainties from emergencies with confidence and ease if you have an emergency fund to your name.  

Visit a prominent financial expert like Wealthclock Advisors in this respect. They offer the best mutual fund investing advice in town!

Start saving for a vacation

it's always good to relax and go on a vacation so that you don't burn out in the early phase of your career. So, aim to save for a vacation to your dream destination or other places that truly captivate you and enchant your soul. When you invest in a smart way you can visit a foreign place with zero debt and through your own savings. 

You can start your planning by aiming to save for three years or go for different investment schemes that facilitate short-term goals like mutual fund investments. 

Start saving for a home purchase

You would want to own your own home at some point in time. A home loan will definitely help but still, you have to pay about 20% of the cost as a down payment. So, the earlier you plan, the easier it will be later. If you save separately for the home down payment, then you need not rely on your savings that is meant for essential expenses like your child's college education or others.  

Are you a “new” Mutual Fund Investor? Here Are the 5 Rules That You Should follow in 2019

Are you a “new” investor? Umm. Let us be more specific. Are you a “new” mutual fund investor? In that case, you might be facing a tough phase while making investments in 2019. Many investors whom we have made a connection with have just started investing in mutual funds after the “demonetization” drive was carried out by the central government. This what has created the major problem among the investors.   

Like you, there are many investors who have staggered while getting negative returns from their equity mutual fund investments. For those investors, it is extremely decisive to stay focused on their investments during uncertain situations. 

Still having confusion about how to handle all your investments? Look no further. Here in this blog we have listed down 5 crucial rules that if you embrace them in 2019, you can surely enjoy in the end, making successful mutual fund investments.   

1. Stop chasing Returns: When you stop chasing returns, the return will chase you. While making your mutual fund investments, it is certain that you will be told about high returns. But if you believe that high returns will knock your door from the day one then you are surely on the wrong track. 

Additionally, there are some investors who prefer to invest their money in schemes depending on their past performance and expect similar returns in the future as well. This is completely the wrong approach. 

Instead of choosing the schemes based on past performance and expecting high returns from the very first day, you need to look for risks associated with it. Higher the risks, higher will be the returns. Hence knowing your risk appetite will help you to make perfect investments. 

2. Focus on your Investment Goal: Every investor has their own specific investment goal. Some want to make an investment for their child's higher education, some make investments for their daughter's marriage, and so on. The list is long but the main motive is to make investments and save money. Therefore, you must go for those schemes that cater to all your needs. 

For instance, if your goal is for long-term, you should make investments in equity mutual funds, whereas for short-term goals, debt funds are the best. Generally, there are investors who invest in mutual funds online just for high returns. But they lose their focus when they encounter adverse situations. Are you doing the same? This is what you need to rectify while you are planning for investments in mutual funds. 

3. Be patience during Uncertainties: Another most important thing that new investors least emphasize on is patience. Patience matters a lot whenever you are investing in mutual funds. Especially when there is any uncertainty or volatile period, instead of panicking, you need to stay calm and keep trust on your investments. 

We have seen many investors, making investments with strong zeal but during the volatile period they withdraw their money. Mutual fund investments is not a game of a year. It has to be played for a long-term period, if not long at least for 5years.

4. Have Balanced Portfolios: Having a balanced portfolios is yet another technique that you must learn while making investments. Based on the market survey it has been found that many investors who have joined mutual funds after the hike of the equity market in 2016, started investing just in equity mutual funds.

Being an investor, you need to keep in mind that one asset class for example equity mutual funds can never perform all the time. There might be ups and downs in the market. Hence it is feasible to depend on a plethora of portfolios, instead of a single one.  

Investing in mutual funds is one of the finest ways to secure your future and achieve your financial goals. But not every mutual fund tailors your needs. Hence, it is beneficial to look for the fund that cater to all your requirements. 

The best way to get the best advice regarding your investment is to look for a financial advisor. Some financial studios like Wealthclock Advisors will help you with your concern.