In an era plagued by economic uncertainties, wealth creation is indeed a tough task. This is especially true if you have a long list of financial goals to accomplish but a limited income to help you in doing so. At such times, even regular investing appears to be a burden.
However, what most people don’t realize is that investments aren’t an end in themselves. They are, in fact, an instrument to guide you to maintain your finances better. With little tweaks in your funding behaviour and with the best investment tips at your disposal, you can turn regular investments into an effective tool to ensure financial success.
Here are a few ways to guide you through this rocky terrain:
Make Small Investments
To begin with, invest small. The income sources of most professionals are limited to regular salary, interest, or pension. Similarly, even the self-employed individuals have a finite cash flow. Therefore, it is wiser to invest small amounts at regular intervals instead of making a single large investment in one go.
Build an Emergency Fund
Do not relegate your finances to merely making short-term investments. Rather, go in for the long haul. Start setting aside a small part of your earnings as part of an emergency fund. This can be done either on a monthly or a quarterly basis. These funds, when charged with good interest, make for a great source of long-term wealth creation.
Create Reverse EMI
One of the best investment tips that a financial planner can give you is to create a reverse EMI, particularly if you want to buy property in a few years. Select a recurring fixed deposit or a bond fund and start investing each month. Over time, you will build up a decent corpus which will take care of all your future needs.
Diversify Your Portfolio
Regular investing can become an extremely secure affair if the portfolio of your investment is diverse. Put your money in stocks, bonds, derivatives, shares, and mutual funds of different varieties. Doing so won’t just protect you against market volatility but would also safeguard your investment from interest-rate fluctuation risk.
Use Savings Instruments
Just like a business uses bill discounting as a simple way to save money, you too should use different types of saving instruments to begin wealth creation. These can range from ULIPs and PPFs to infrastructure bonds and national saving certificates. This locked-in amount would yield high returns at a later date.
Making regular investing a part and parcel of your current fiscal schedule is the ideal way to make certain that your future holds promise. Irrespective of what your position or profile is, one of the best investment tips for you is to not consider investments as an expenditure. Instead, treat them as a foundation upon which your financial success will be built.