How to make your money grow

We start investing in a small way and slowly and steadily we build a good corpus, but all this was not easy. We might have burnt our fingers on the way. If you had taken the help of a financial advisor the journey would have been less painful. Never the less, we have to learn and that is the only way to grow.

First thing to remember is always invest in an asset class based on your goal and time horizon. Many people I have met, just invest based on the past returns of a particular asset class. All asset classes have their own ups and downs and nobody can say for sure, when is the right time to invest in a particular class of asset. Some like gold, others like fixed deposits and others like equity. But investment in a particular class of asset should always be based on goal and time horizon. It should not happen that when you actually need the money, the market for that particular class of asset in which you invested is down.

Next to remember is when it comes to investment you need to have discipline. Do not go by rumors or market movements. If you have invested with a particular time horizon and nothing has fundamentally changed, stick to your course.

For those who are risk averse and prefer FD’s, please check the credit rating before investing. Many companies give interest which is higher than the market rate of interest. They are ready to give those rates as nobody else is ready to give them money. Go for AAA rated fixed deposits only.

Always have a plan for your investments. If you do not have a plan you will find it difficult. Before you start your investment plan, make a contingency plan, basically your investments plan should not be derailed just because of some untoward incident. So get your insurances in place, be it health or life or even house. Any plan made should take into account taxes. What is the point of making money and giving most of it away in taxes.

Last but not the least, monitor your investments on a regular basis.