Ways and Ideas to Invest Money
Investing your money is very important in order to have a secured future. You can invest your money either to meet some short term goals like buying a car, a foreign trip or you may invest for your child�s marriage, higher education or for your own retirement. Now when you have decided your investment purpose and desired amount, you need to find out the approximate years, by which you would like to get the desired amount. But before start investing, first you need to find out your daily and monthly expenses. Now when you know the exact amount that you can invest for your goals, you must put some money into your savings bank account to meet unexpected expenses or for some urgency.
Now you have some money in your savings account after putti
ng aside money for monthly expenses. Now it is the time for you to start investing money for your needs. To invest money, you need to find out all of your investment goals, amount of money that you can invest, time period of each goal and then divide the money for separate goals as per the needs. You also need to know your risk taking capacity. As there is an old saying �High Risk. High Returns.�� If you do not want to take any risk with your hard earned money, you may get less returns, but you have the surety for your money.
To have guaranteed returns, you can invest in Fixed Deposits or CD (Certificate of Deposit). There are various schemes available from Post Offices like NSC, KVP, MIS and others which offers secured returns. You can also invest in Company Deposits that gives you some better returns than Bank deposits, but if you are going for Company Deposits, go for companies with good ratings, which have 'AAA' rating or any higher rating than this.
All these investment instruments comes up with different time period and lock-in time, you need to find out one as per your needs. You may also be interested in knowing whether the maturity/returned amount is taxable or tax-free. The best option to put money is in PPF (Public Provident Fund) but this comes with a lock-in period of 15 years. You can take your complete money only after 15 years, but you get tax benefits on the deposit amount and also the interest amount is non-taxable.
Whatever option you decide, always try to be diversified and look for liquidity. Do not put all of your money in PPF or similar instruments, as you can not take out your complete money for years. So put some money in other instruments where you have access to your money at any time you want, like in the case of Fixes Deposits. You can take out your complete money at any point of time, banks will only deduct some percentage of interest amount in case of pre-matured withdrawals.
If you have a good appetite for risks, go for stock market. Stock market is the place where you can really get good returns, but the risk associated is also really high. You may get 10-20% returns in a weeks time and you may also lose half of your money in the same time. There is a risk, but if you look at long term and invest in good companies (Blue-Chip, or Large-Cap), chances are you will get good returns of around 12-18% annually. But if you will look for the short term returns, you need to be very careful as stock prices go up and down very frequently.
Another option to put money in stock market is through Mutual Funds (MF). There are fund houses which invests your money on your behalf. They have analysts, specialists and persons with good technical knowledge of stock market, making stock market a less risky place for you and your money. So you can invest in Mutual Funds, which on your behalf will buy certain stocks and change the portfolio of stocks as per the market conditions and using their own experience. Investing in Mutual Funds is considered to be a long-term plan, for about a horizon of minimum 3 years and they can give you really good returns after 5-7 years. There is no lock-in period for MFs, you can sell them anytime you want. But try to be a long-term invesor to see your money really grow.
You can also invest in property; buy a land, a house, some commercial space. This option can also give you really good returns but you need to invest more amount of money in order to buy any property.
There are various other things to know and consider when you invest your money, check out more details in further sections.
