We see that as the needs of a human being are fulfilled, so his desires increase further. Well, this is life. Money is the only means to fulfill human desires. He tries for all this and finds new ways to earn money. One of those ways is investing in ‘Mutual Funds’. But whenever it comes to investment, people get scared and that fear is not for anything else, just the fear of sinking their wealth. It is also reasonable to be so, your hard-earned money and it goes away so easily, it is not right. But somewhere the reason for fear is lack of investment knowledge. If you have the knowledge to invest and you know how to invest, then there is nothing to fear. So let us know how to invest in Mutual Funds, what are the advantages, what are the disadvantages, and whether investing in it is right or not.
Mutual Funds
It is a type of group investment in which a lot of investors invest money into the fund. Mutual fund accounts are maintained by mutual fund companies. They collect money from investors and invest it in the market. The fund manager does all the work. The investor need not worry about anything. But the investor is responsible for the loss and gain. When there is a profit, the money increases, and when there is a loss, the money invested decreases. Similarly, the balance of money remains. The manager maintains an account of the investor’s loss and profit, and he looks after it.
Advantages of Mutual Funds
First of all, you do not need a huge amount of money in this, you can also invest with a minimum amount of 100 rupees. And this is why it is suitable for both small and large investors. The other advantage is that after investing in it, you do not have to worry about any kind, the manager has all the responsibility ahead. He will tell you about the loss and benefits, as well as when to invest and when to withdraw money. The next advantage is saving your tax, you can save tax up to Rs 1.5 lakh every year by investing in mutual funds. And the biggest benefit is that your money is monitored by government institutions so that your money is completely safe.
Disadvantages of Mutual Funds
Just as everything has its disadvantages, so to are some of its. Like, there is a fixed period (5-7 yrs or 1-2yrs) of time to invest money in mutual funds, before which you cannot withdraw your money and even if you withdraw money, you lose some part of it. Next, if a person invests money in more than one mutual fund, his profit is divided and there is no complete loss or gain.
Now let’s talk,
How to invest money in mutual funds?
First of all, you should invest the same money that you have extra because money needs to be kept in investment for a long time. Do not invest money at the behest of others or under the influence of someone. Invest money when you think it is right for you. Before investing in any mutual fund, keep full information about it and also find out other expenses related to investment. To make more profit, invest regularly in any fund for a long time. Do not put the entire amount together in any fund, invest in different funds a little bit. The most important thing is to check its old record before investing in any fund.
If you are interested in investing, you can get more information related to it from the podcasts available on Paisa Vaisa, Money with Monika, MF101, dedicated to mutual funds only. You can also listen to it IN HINDI also.
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