Dear Mommies and Mommies-to-be, we are sure that by now you are ready to take that first step towards financial independence. Not yet? Moms make the best investors! Read to know why.
And investments are not all that complicated! Read to know how you can begin your investment journey in 4 simple steps!
It is time for you to stop ‘worrying’ about your child’s future and take charge! Before we delve into what kind of mode you should be investing through, let us understand some important things about financial investments.
Among the simplest and most effective ways of investing is through the Systematic Investment Plan (SIP) route.
In simple words, an SIP is a mode of investing money in mutual fund schemes managed by Asset Management Companies or AMCs. Rather than investing a lump sum amount, SIP allows you to invest as little as INR 500 periodically in a mutual fund scheme of your choice. The SIP amount is usually auto-debited from your bank account on a date selected by you.
Sounds simple enough, doesn’t it? Let us understand the basics of SIPs a little better.
As mentioned before, you can start investing in SIP with just INR 500 per month. Given the low entry barrier, it is among the most popular modes of investing. It also ensures that you remain consistent in your financial journey and achieve goals sooner. SIPs automatically makes you a disciplined investor.
The next valuable benefit of SIPs is Rupee Cost Averaging (RCA). As you’ll be investing a fixed amount every month, there is no need for you to worry about market conditions. In the long run, the cost generally averages itself and proves highly beneficial for the investor despite ups and downs in the market.
When you select a mutual fund scheme for SIP, you'll mostly get two options - growth and dividend. If you go with the dividend option, you'll receive gains from the plan periodically as per your investment amount. However, if you go with the growth option, your dividends would be reinvested in the fund and get you the benefit of compounding.
If you are investing in SIP plans for a long duration like 20 years, this power of compounding, which will earn you returns on the initial amount invested as well as the returns from each year, can significantly enhance returns.
While it is ideal to start your investment journey right from the time you bag your first job, there is no wrong time to start investing. The simplicity and flexibility of SIPs with excellent potential for returns have made it a go-to option for modern investors, especially women and new mothers.
So don't let anyone else dictate your finances, your savings or your financial aspirations. Be it your child’s future, your next business venture or that vacation you want to take! Take the first step and invest right away!
Mutual Fund investments are subject to market risk, read all scheme related documents carefully#financialplanning #besmartsavesmart