Here we are discussing some simple ways to start an investment and how to climb the ladder of growth.

 “Do not undermine the nut that would be a palm tree someday.” This holds true for everything from a caterpillar to a butterfly, a brick to a building, a penny to a fortune, and so on. In other words, even a small step in the right direction will reap you huge dividends. It applies to investment too. What is required foremost is the will to invest. How does one go about planning one’s personal investment? In this article, we shall look at some of the options available to individual investors. 

An idea about one’s monthly expenditure is the first step in understanding how much one can invest. The amount which is available over and above the monthly spending can be the starting point for investment. The next decision one needs to make is how much risk one is willing to take. Whether the investor wants to play totally safe or willing to invest in a way, he gets better returns.

HIGHLIGHTS

• Evaluate your total monthly expenses and make adequate savings; also, see where the amount can be saved more.
• Know the type of investment that you are aiming for.
• Make plans to save enough to begin an investment.
• Be prepared for potential risks and losses which you may encounter. 
• Monitor your investment and make more significant investments once it has achieved stability.

Did you know?

One of the world’s youngest billionaires comes from Rayagada, India. Ritesh Agrawal, the 26-year-old founder of the Oyo Hotel, led a life of poverty for 18 years. Starting with initially just 50 Rs in his possession, he helped a hotel owner attract customers by redecorating the interiors, adding better services. The secret to his investment goal was not about how much money he had, but to be able to solve the problem in front of him. The hardship in building the audience in one hotel taught him that it was possible to construct simultaneous investments in more hotels. He then hired 50 people at age 21, reached a total of 500 hotels at age 22, and raised $1 billion at age 26. Today Oyo is a popular chain. He started small and soon replicated his success.

Investment Opportunities

Whether you are looking to start with a small investment and play it safe or go big with high-risk, high returns investment, here are some quick tips. The choice depends on the investor’s financial goals and what amount he wants to invest.

• Bank fixed deposit (FD) 

The safest investment mode is the term deposits or FD, wherein the investor can invest for a fixed term and earn a fixed percentage of interest. However, safe returns are quite low.

• National Pension System (NPS) 

National Pension System (NPS) is a pension cum investment scheme launched by the Government of India. It aims to provide security to the Indian citizens during old age. This is a long term investment wherein an individual can slowly and steadily plan for his retirement. It is a safe and regulated market-based return. 

• Public Provident Fund (PPF) 

Public provident fund is a long term investment opportunity for investors where the focus is to keep the principal amount safe. It has many benefits, like tax rebates for the investor. It is also a long-term investment scheme where high but stable returns are possible.

• Mutual funds

Mutual Funds allow the investor to invest as little amount as he wants but provides an opportunity to diversify into multiple instruments, namely stocks, debt, and gold. One can also opt for the Systematic Investment Programme or SIP. 

• Direct equity

When a company tries to raise capital by selling stocks to investors, it is called equity. One can become a shareholder by investing in the stock, and by doing so, acquire ownership interests in the company.

Finally, what an investor has to consider the fact that he has no control over the uncertainty of markets. He should base his investment decisions on real facts rather than speculation. 

“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful”. – Warren Buffet