I want to share a very important and useful information about one of our favourite subjects – Money! A quick true story: Ever since I started earning, my elder brother who in an expert in finance has suggested me to invest my money and not let it remain idle in the savings account. Whenever he used to bring the subject of shares and investment, like any lazy youngster, I procrastinated it, though I knew it is important. But, as I am 24 something now, I realize the mistake and I’m guilty of the delay! (See dada, I am publicly saying this! 😀 ) Lately, we had a serious discussion about Mutual Funds and since then I started my basic research about the subject just to have a know-how about it.
Recently, I was invited by Reliance Mutual Funds via Blogmint for a meet and no guesses, it was about Mutual Funds, it’s like the universe is encouraging me into this! It was an extremely educative seminar sort of a meet that rendered upon us tremendous valuable information for which I am really grateful as I got to learn a lot. Reliance MF is the third largest Mutual Funds Company with over 6 million investors. It is spread across multiple nations and is providing valuable MF Schemes to investors. They started the Mutual Fund Day initiative with CNBC TV.
Let us have an overview of what mutual funds are and, why are they so important!
What are Mutual Funds?
In layman’s term, a Mutual Fund is nothing but a pool of money from multiple investors (individuals) who wish to invest their money and let it grow. It is just handling your money to an expert so as to have it grow. It is a lot easier than buying and selling individual stocks and bonds. Here, individuals need not do all the work but the company does! The company that manages the Mutual Funds is called an Asset Management Company (AMC). There are multiple mutual fund schemes according to the needs and requirements of the investors.
Why should we invest in Mutual Funds?
This is one of the commonly asked questions! If you have a regular monthly income flowing in, then it is wise to have it invested somewhere so it does not remain idle. Most of the people open a Fixed Deposit account or invest in Gold. These are usually the traditional methods followed by people. As most of us are unsure of the share market, its working, we conveniently choose to stay away from it.
Also, along with the ignorance and passiveness, there is also a fear of risks involved. The most popular line that we often hear after the Mutual Fund Advertisements is “Mutual Funds are subject to market risks, please read the offer document carefully before investing.” It is literally fixed in our heads! But, the truth is, it is just to make the customer aware about the same like I previously mentioned, it is a profitable investment when done for long term.
So, now coming to the answer, when we keep our money in savings account or even in FD, the rate of interest that we get is very low. And due to inflation, our hard-earned money does not grow but at times decreases its value. It is said that FD is a sure shot way of reducing your money when people think the opposite. If you check the past records, mutual funds provide almost double the rate of interests on your hard-earned money and let it grow multi-folds!
Mutual Fund Day – 7th of Every Month!
Reliance Mutual Funds (RMF) in association with CNBC TV 18 have initiated Mutual Fund Day on 7th of Every Month to create an awareness about the benefits of Mutual Funds.
The sole objective of this initiative is to help the investors understand and reap the benefits of the various schemes made available to them. India is a nation of savers! We have learned to save from our parents and we continue the tradition, but growth happens in investing it further! The technology has eased the process even further and now everything just happens seamlessly in a few clicks.
The simple example that got me going is, if I am 25 years old and I invest even 5k every month, I will get over 3 crores in the period of 30 years. My retirement is sorted! 😀 On a serious note, with SIPs or Systematic Investment Plans, you can start with as small as RS. 500 per month. Also, there are liquid funds that provide you flexibility and ease!
I tried my best enlightening all you readers about the subject and it’s importance. If you have any queries do let me know in the comments below, if they are some technical ones, I’ll have my brother answer them to have you sorted! I truly hope this was useful to you! 🙂
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