Expert advice: How to use investment offers effectively

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Here is how to get the best out of your savings

Invest for a better future
Invest for a better future

Risk and return go hand in hand when it comes to investment. In this game of gamble, sometimes we get a bit confused while picking the right investment offer which suits our lifestyle and financial goals.

To lessen this confusion, Team AAW got Ashok Kumar ER, CEO, Scripbox with us to put light on the common questions

1. What are the check measures to identify the risk attached with investment offers?

Every investment instrument comes with an inherent risk and promise of return. The most solid ones which will almost guarantee you a return of 6% to 7% annually can be treated as zero risk but will also not beat inflation tomorrow. So your Rs. 100 today will be worth much lesser in return tomorrow. For you to beat inflation, you will have to invest in instruments that can beat inflation. Thus, returns from an FD are not wealth creating though, the returns are guaranteed. If you go through mutual funds, real estate, equity and the stock market, etc., their returns might increase and beat inflation, and the risk factor also high there.

2. What is the right age for women to commence investing?

Investments are gender neutral. In a fairly equal society today, both men and women should start investing at the earliest possible, the earlier you start the better the returns. What differs is the goals men and women have which should decide how much should be invested, the duration of investment and the type of investment instrument chosen.

3. What is the ideal market situation or time to invest and also advice when not to put money in the market?

Market volatility is common cause of concern for potential investors and a major stumbling block to decision making in investments. Let’s clear this myth. The basic principle of investing in an instrument like mutual funds is to stay invested for a long period of time is to put money and SIP instead of bulk investments. If your principles of investment are right short term market volatility ceases to be a factor in the long term. Any easy 10-20 year equity market analysis will show that over a period of time results are always positive. The right time is thus, now.

4. What is the basic checklist to judge a beneficial investment deal?

Track record of the investment instrument is the best indicators of the likely-hood of success as an investment. The real challenge lies in the huge number of options that are available, which makes it hard for the new and beginner level investor to understand and make sense of these numbers. Biggest value of a trusted financial advisor would be to help make investors sense of the jargon and the options available thereby, making investments an easy process, and this what we do at Scripbox.

5. There are a lot of investment offers doing rounds in market these days which are too catchy at first glance. How to pick the genuine one out of fake offers?

In the world of financial investment, if something sounds too good to be true, it usually is. We have never been short of supply of get rich quick schemes which test the resolve of even the seasoned investors. Our advice is to keep it simple, spread your risk and be disciplined when it comes to the right principles of investment.

6. Any other tips or dos and don’ts.

Financial literacy at an early age is missing in our education system. We believe that from a very young age, parents and teachers should inculcate health saving and spending habits which will build the discipline of building wealth when they become adults. As a parent, you must take that step and employ simple behavioral lessons that will seed financial intelligence in your child early in life.

If you still have a bunch of doubts doing round in your brains then comment your question below as putting your hard earned money somewhere should be your perfect decision. So why fear when AAW is here. Go ahead with investing.