A solution for your Emergencies

Emergency funds

Keeping money aside to face your emergencies is important. We all do have a situation where we need money – it can be a medical emergency, sudden job loss, disability or certain health issues which may stop you from earning. One should be very clear on the statement that – Your emergency funds cannot become your savings whereas your savings can be your emergency fund. Your savings and emergency funds are not the same. They are two different things. These two are differentiated based on an individual’s planned and unplanned expenses. Generally, savings are made to meet one’s planned expenses.

For example: Think about buying a car, where you will pull all your savings, take a loan or you borrow from your relatives or friends. These are events you can prepare and plan for. Then what about unplanned expenses? Sudden job loss, huge medical expenses, health issues that stop you from earning all these can be one’s unplanned expenses. This is why we create an Emergency Fund.

Savings and emergency funds are two different categories. Savings provide you the financial freedom to make an investment which can be for a short or a long term and helps you meet your financial needs. Whereas emergency fund provides you the financial security by assisting you in financial crisis.

How much you need for an Emergency Fund?

Roughly keep aside six months of your living expenses including your EMI, rent and school fee. You can increase or decrease this figure based on your personal situations. Say you have decided to have an emergency fund of Rs.1 lakh, in this case, you can put aside money of Rs 5,000 or Rs 10,000 every month. On being more specific:

  1. If you and your spouse both are working and have no dependents, in such cases, 3 months of your living expenses can be kept aside for an emergency fund.
  2. If you are a sole bread earner of in your family and you have many dependents then one year of your living expenses can be kept aside for an emergency fund.
  3. If you are risk-averse, then you can keep a year’s expense like an emergency fund.

Where you keep this money?

The money which you keep aside i.e., an emergency fund cannot be kept idle. So you can move these funds to a place where the accessibility is less and liquidity is high and offers better returns than a savings account. Accessibility is less because more often you cannot take out the money unless its an emergency.
Fixed deposits can be an easy option. Certain banks offer flexible FD’s that will allow you to sweep the money that you need without any additional charges. Hence you can go for it.

Another popular investment option is – “The Mutual Funds”. You can go for short- term debt funds to build an emergency fund. These debt funds offer you a better return when compared with FD’s. These debt funds are more flexible and the incident of tax is very less comparatively.

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Therefore, set yourself a target and plan accordingly. Make a regular monthly credit towards your emergency funds. Hence be prepared for uncertainties of tomorrow. If you don’t have anything saved towards an Emergency Fund, it is not too late to get started. So, start with MyWay Wealth.

The little you put, the more you can do!

Understand the rules for investing in Equity

equity

Getting equity exposure is about following the rules for holding the portfolio to see index-plus returns( high returns). Take a considerate decision on investing in Equity and understand that the Equities are the best way to create wealth.

Rules for investing in Equity:

  • Have the patience to see consistent returns. If you buy equity with a holding period of 10 years, you’ll be able to see interesting returns(positive returns) in the 7th year of your investing. This happens because the fluctuation in the returns will start reducing and then on average, you’ll see returns which will above 14-15% per year. Thus, have the patience to have investments in the long term.
  • You’ll be at risk if you choose a poor product. If you opt for a poor product with a long holding period and later you find yourself that you did worse than the average product in the market. So, be careful while choosing a product and be very particular on your risk bearing capability.
  • What if you find out yourself frozen in choosing Equity products. Firstly, understand the Equities completely.

There are 3 ways to buy equity:

  1. Direct stock
  2. Market-linked products(ULIP’s)
  3. Mutual Funds.

You can invest in Equity Funds through MyWay Wealth. They are professionally managed by expert professionals who spend quality time in researching about the performance of these funds.

The benefits include:

  1. You can invest in Equity Mutual Funds that have provided returns >15% for the past 5 years.
  2. They offer you an opportunity to redeem your investments at any time (Except for Equity Linked Saving Schemes-‘ELSS’ which has a lock-in period of 3 years).
  3. Equity mutual fund schemes avail you a facility to invest small sums at regular intervals through systematic investment plans (SIP).
  • Do not invest in any product that locks you in a particular company or asset manager. Always opt for the product where the “Exit” is possible with an easy and cheap procedure. And also look for the “portability” where you should be able to move your money more easily to the better fund investment with minimum cost.
  • If you want to manage your funds by yourself, start learning about the products through online platforms and try to look in the records to know how the funds are performing over the years and then invest. Always remember, “Not investing in Equity” is not your option.

Thus, put your money to work for the long term. If you’re a good financial planner then you would have already planned for your Emergency funds and medical cover. So, you have taken away the need for keeping money in liquid and you can risk for investing in Equity Mutual Funds.

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Here, you have the best platform -“MyWay Wealth” to invest in Equity Funds and create wealth for the long term. Use MyWay Wealth to discover, track and invest in Equity Funds.

Are investments in Real Estate really safe?

equity

We have heard our elders saying that “Invest in Real estate, the future value of the property will fetch you prosperous wealth.” Is it true?

Let us now discuss how a Real estate as an investment option.
Yes, Investment in Real Estate can generate a regular income, and you can see capital appreciation over a period of time. People think Real estate as an investment option is good only because they look only into the returns ignoring the other factors.

There are other factors that you need to consider:

  1. Risk factor: There is more risk involved if you buy a property, and risk comes in the form of property disputes, your property can be grabbed, finding the tenant becomes difficult.
  2. Additional expenses: Incurring more expenses can affect your returns. Expenses such as brokerage chargers, maintenance costs, taxes will be incurred by you. You will pay all these expenses from your returns.
  3. Low liquidity: In case of emergency, to can’t sell a part of your property and make money and also your need for cash can make you sell the property at a lower price than its original cost. Thus, you incur a loss.
  4. Market fluctuations: Yes, there has been a time where you can sell your property more than 10 times its original value but the things are changed and are not the same.

Reasons why an investor should avoid investing in Real Estate

  • An under performing asset class as it gives more or less the same returns as FDs and offers an annual rent between 2-5% which is very less when compared with the returns earned on FDs
  • The value of a property depends on the geographical location of a property which makes a real asset as an unpredictable asset class.
  • The typical mentality of investors where they link properties to memories and emotions ignoring the returns on investment.
  • Liquidity is less because when you need immediate cash, you can’t find buyers easily and need of cash can make you sell the property at a lower cost than its market value.
    They are subjected to more litigation and the risk involved is high because of property disputes or your
  • property can be grabbed.

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Thus, these are the disadvantages of having investments in Real Estate. But is an alternative? Yes! there are better options to invest such as Mutual Funds. Direct Plans, SIPs, Gold Funds or Equity Mutual Funds help you with wealth creation in the long term. Use “MyWay Wealth” to discover, track and invest in Mutual Funds.

Don’t invest in better, invest in the best!

Expose your money to Equity!

Equity investment earns you the best returns when compared with the other investment options. Now, let’s understand the true nature of all the investment options.

Investment options Initial investment Finally earned

(principle+returns)

Fixed deposit 1 lakh 19.35 lakhs
Gold 1 lakh 16.10 lakhs
Public Provident Fund 1 lakh 32.78 lakhs
Equity 1 lakh 2.3 crores

 *A period of investment is considered as 30 years for all the investment options.

Then what are these Equities?

Equities are the stocks/ shares that are listed in the stock exchanges which are traded at the market price. You can invest in Equities in two ways:

  1. Direct investing in Equities-You will directly purchase stocks of listed companies through a demat account.
  2. Investing in Equities through mutual funds.

Why one should not buy Equities directly?

Think, how do you know which companies equities to buy?

Because, if you are new to investing, then opting for the wrong equities will cost your money and peace of mind. When you decide to buy equities through mutual funds, you outsource your decision to the Stock Experts. As an investor, one only needs to invest the desired amount and become a part of the fund holdings, and the professional managers will do this job.

Key advantages of investing in Equities through mutual funds:

  • They are professionally managed by expert professionals spend quality time in researching about the future performance of companies.
  • You get an exposure to various stocks when you are invested in an equity mutual fund scheme
  • They offer you an opportunity to redeem your investments at any time (Except for Equity Linked Saving Schemes-‘ELSS’ which has a lock-in period of 3 years).
  • Equity mutual fund schemes avail you a facility to invest small sums at regular intervals through systematic investment plans (SIP).

How to invest in equity mutual funds through?

You can start investing in Equities Mutual funds through MyWay Wealth. MyWay Wealth provides you smart recommendations to build your wealth scientifically and financially.

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Thus, be smart in choosing your investment option. Always opt for investment that matches your financial goals and risk appetite, choose the scheme that matches your profile. Equities will end dependency on gold, real estate, and FDs.

It is not market timing but time in the market that matters!

Build your Portfolio with the right Asset class

Retirement

We’ve grown up with FD’s, Real estate and Gold as a “Holy Grail” of investments. Let’s understand the true nature of all the investment options which you can include in your portfolio.

Basic finance is not tough to understand, but it’s good to have knowledge in finance which will help you in choosing the right product that suits your financial needs. Finance keep things tough because the less you understand, the more you can be cheated. It just takes common sense and some time to ‘get’ finance.

Before we choose the financial product, we do look into aspects such as the cost, the number of years you want to have that product, risk and security, and the post-tax returns that you earn.

There are various investment options available

Portfolio

Let’s talk on “Debt” as an Investment Option

When we hear the word “Debt” makes us think about all the debts that we have (car loan, house loan). Here the “debt” forms a part of your portfolio where you’ll get fixed returns likes your FD and Public Provident Fund. Debt is based on borrowing- where the bank will borrow money from you for a fixed and periodic return. The principal amount will be given back to you upon the completion of the agreed time period.

Why do you earn interest on your money?

  • Because you delay your consumption- you get compensated for this.
  • You bear the risk of the borrower not returning it.
  • You take the risk of money-losing its value (due to inflation).

Why do government bonds pay less interest?

Higher the Risk- Higher the Return. The more you get paid on your lending, the more risk you take (Risk→ non-payment of both your investment and interest is much higher).

Debt product with Guaranteed Return:

  • Public Provident Fund
  • Employees Provident Fund
  • Fixed Deposits
  • Corporate Deposits
  • Bonds

Features:

  • Debt product provides money at short notice and stability for long term investments.
  • These are safe, tax-free, and provide a solid core to your portfolio.

Why not put all your money into debt?

We want to be certain about what we get back in the future. If you drop your entire money into debt- your risk will be high, where the chances of getting the money back become doubtful. And also you can’t see the growth in debt when compared with Equities. Debt is for stability rather than growth.

Is there an alternative?

Yes! That is Debt mutual fund. They invest mainly in debt or fixed income securities such as corporate bonds, government securities that have various time horizons. The benefits of having Debt Mutual Funds are:

  • Unaffected by market volatility
  • Provides stability
  • Tax deductions
  • Highly liquid

To get access to Debt Mutual fund, MyWay Wealth is one top destination.

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Let’s talk on “Gold” as an Investment Option

We find that money kept in a bank is eroded by inflation. In order to mitigate risk and inflation, we started buying gold. Gold is treated as a weapon to fight inflation which means that- as the prices of gold rises, your money will not lose it’s purchasing power.

Can you make profits in gold?

You make a profit in gold- when there is a rise in prices. Adding on- profits you make will also depend on when you bought it and how long you held it for. Suppose you purchased gold

  •  3 years ago- you would have earned 2-3% returns.
  • 5 years ago- you would have got your investment back with zero returns.
  • 10 years ago- you would have earned 9-10% returns.

Thus, if you buy Jewell thinking that you’re making an investment- this is how your returns will vary.

Gold Jewell as an investment option:

Every investment we make has a cost attached to it, which can be seen or unseen- like making chargers for gold jewelry. When you sell Jewell, you’ll lose 10-30% depending on the purity of gold and making charges. So, buying gold Jewell as an investment doesn’t make sense.

Options to buy Gold:

  • Gold coins and bars.
  • Gold ETFs (Exchange Traded Funds).
  • Bonds issued by Government.

A smart investment decision you can make is to buy gold bonds issued by the government which will not only give you full market value when to sell the product but also gives you 2.5%-4% of returns every year.

Thus, when you buy gold do buy it sensibly where not more than 5-10% of your portfolio goes to gold and do not buy Jewell as an investment.

Is there an alternative?

Digital gold is relatively very new to the market. It is very simple and transparent to buy and sell gold instantly. Physical gold has limitations on safety and security issues. But there is another gold investment option that overcomes all the challenges of holding physical gold and that option is “Digital Gold”.

Are you looking for the best platform to make a gold investment?, here are some of the features of 24K Gold on  MyWay Wealth,

  • You can buy 24k Gold and skip the responsibility of safe-keeping and traditional lockers.
  • You can get a free and secure locker from BRINK’s, a global leader in gold custodian services with 100% insurance cover.
  • Sell your gold with one click, anywhere and any time.
  • Get your gold delivered to your doorstep, hassle-free.

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Let’s talk on “Real Estate” as an investment option

Real Estate is a must-buy thing for people with investing in their minds. After gold, people are obsessed with Real Estate. It is a “chunky investment” with a huge cost attached to it.

Why “Real Estate” is not a good investment option?

  • It is very limpid- you can’t sell in a hurry. You have to sell the whole property at once.
  • A huge maintenance cost-  you will incur periodic expenses to maintain it.
  • The risk associated is very high because they do not come with any guaranteed returns.

Why do we like it so much?

There are mainly three reasons why people go for Real Estate:

  1. Habit
  2. Black money
  3. Fear

Habit:

we’ve heard stories about how the land in the village that cost just a few thousand is now valued at crores. The reason why people think real estate is a great investment because they just look into the returns ignoring the risk associated with it. The fact is that the time gap between selling and buying includes a maintenance cost, property taxes, brokerage, and insurance. The effective rate of return before considering these costs is what that matters to everyone. And again between the same time gap, a lot of things can happen and can go wrong as in like- the title can be disputed, the land can be grabbed, the tenant can create a problem.

Black Money:

The habit of black money is so strong that we can’t even imagine where a cash payment is an exception and full cheque is a norm. Unless you have illegal money stay away from real estate in India because the prices get inflated due to improper cash flow in the system and if corruption is cracked, you can’t see any price rise for decades.

Fear:

People always choose real estate just because- the fear of unknown investment options. Earlier they had only a few investment options- gold, real estate, bank deposits where everyone has chosen to invest in, but now the presence of many guaranteed return investment schemes are stopping them. This is because the stock market scams in the past are haunting them.

Thus, we should be careful about where we invest our money. Before making investment count the cost which you may incur and also decide upon the period- for how many years you want to hold a particular investment. To see the true face of your investment- you can even look at the post-tax returns which you earn.

Go for a real gain, not just for the gold!

Think MyWay Wealth!!!

You don’t have to be expert to Invest

MyWay

We hear people saying that- “I’m not an expert, I can’t invest in the market”. People fear to invest. They fear because of not being educated enough about the stock market and losing money scares a lot of people. At times you feel you’re too poor or too young or too dumb to begin. No matter what your age, stage or circumstances are, you need to start investing in the right way. You need to decide what is important, where to invest and find out the right way to raise money.

Reasons why people resist investing:

  1. Not having enough money to invest
  2. Their desire to keep money in liquid form for future emergencies.
  3. Fear of making mistakes in investments and losing money.
  4. Lack of knowledge in share markets.

Think…..

You can’t say that

Many will not begin the process of investing because they say that they don’t have enough money to make investments. We don’t need a large lump of money to invest. Your small savings can be bought up to make a large lump sum. Suppose if you begin with just Rs 1000 a month, it’s Rs 12000 in a year. Most people will be able to save anywhere between Rs 5000 to Rs 10000 a month. Now you have an answer for “where is the money to invest?”.

What if…

Yes, creating an emergency fund and buying insurance is very important which enables you to protect yourself from unseen happenings and reduce your financial damages. But do remember creating them will also reduce the need of having cash in hand. And this cash in hand can be a reason that people don’t invest for the long term.

I fear to make mistakes…

A lot of people manage to make investments in fixed deposits, real estate, life insurance, and gold even though they feel that these are high-cost investments that yield fewer returns. Always remember it’s better to have something in investment even if it earns less rather than having the one that earns you nothing.

Make some time to understand “finance”

“I don’t know anything about investing” is the most repetitive dialogue we hear from people. Remember, understanding the word “investing” is like “one-off” in terms of your time. Once you get it, nobody can take it away from you and once you understand the logic behind making in different securities, you will never get cheated by anyone.

How much money do I need to invest?

The next most asked question is “how much do I need to invest?”. All you need to do is to be wise by planning your investments and get suitable returns. It will depend on various factors like:

  • Why do you want to invest?
  • For how long you want to invest?
  • How comfortable are you in taking the risk to have higher returns?
  • How secure is your job?
  • What other financial products do you have already in your portfolio?
  • Are you an entrepreneur or a salaried employee?

Hence, these are the factors that influence your decision on “how much”. Every time you make an investment keep in mind that “your financial product should solve the problem that you are facing”.

Moving on…

Now, you are ready to make an investment in different investment products and it’s your turn to find out the product that suits you. Let’s create 3 different cells for your investments i.e., Almost there, In some time and Far away.

Basis Almost there In some time Far away
Span Any planned expenses that happen in 2-3 years Any planned expenses that will incur pen between 3-7 years Any planned expenses that are likely to occur in the distinct future
Need Sending kids to school, buying a car, buying a house. Kid’s higher education, Kid’s marriage. Retirement

 

Now you need to know “What amount you need to invest today?”. All you can do is just figure out all the expenses that you may incur and assume a certain rate of inflation to raise the cost. So, you know approximately how much you will need in the future. There are some online calculators available that will help you out.

Thus, start doing rather than waiting for a movement. Do remember you’re not a trader, you’re an investor. It is the role of the trader to speculate the market and as an investor, you make an investment. Look for a financial product that matches your financial need. Every product will have a certain lock-in period and has a time period where it works at its best.

Looking for the investment options – you can invest in MyWay Wealth. All you need to do is download the app, register & KYC (know your customer) and start investing a small amount every month, which is SIP (Systematic Investment Plan), with just Rs.100/-.
Sign Up on MyWay Wealth: Invest now

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Don’t Delay! Start investing today with MyWay Wealth.

Retirement: Not an end, but a new beginning

Retirement

Many will plan for retirement but still, there are people who want to work till they die. It sounds good. What if things go wrong? There are two things: one- your health, two- the ability to work. Your aging body can lower your immunity and can reduce the work you do. As you age, you might feel difficult to cope up with the new skills which earn your bread.

So, it is better to have a plan for retirement to set yourself financially free. “Financially free – where you don’t need to work to pay your bill and have enough assets that earn you returns for today and for the rest of your life”.

You can be financially free only if you have answers for these questions:

  1. How can you plan for your retirement?
  2. How much is enough?
  3. How can you know that you are on track?

(more…)

Why is it essential to have a Health Insurance Policy?

Family protection

“Someone is sitting in the shade today because someone planted a tree a long time ago.”

–Warren Buffett

It is rightly said that “Health is Wealth”. Planning for medical costs is one of the important aspects of your financial planning. It is very important to ensure that you and your family are secure in the future both financially and medically. It’s more challenging to meet the medical costs over your savings. If you have a “Good Policy”, there is no need to dip into your savings.
We have seen instances where people will be saying that they purchased a cover that will not bear the entire medical expenses or they purchased a wrong policy which they got know after reaching the hospital.

What is Medical cover?

Each time we go to a doctor for viral fever, we never feel that the cost is high because we choose a doctor based on our spending capacity. But when you have some serious health-related issues where the cost for the treatment is very high and you’ll be felt with the only options- paying the cost from your savings.
So, to overcome such situations we buy Medical covers where you will transfer this risk to an insurance company for a price called “Premium”. If you buy a Medical cover, you get reimbursement of what you had spent and at times you may not get the entire amount (depends on the type of cover you buy). Buying a good medical cover is a great deal because as of today you have more than 30 companies that offer a medical cover, also you have different policies wherein you’re supposed to choose a policy that suits you by going through the entire Boucher (which we usually don’t do).

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You have to make it count

Good Financial Plan

Everyone will have money to save- from a poor lady who sells vegetables on the roadside to the Big shots in society. We simply don’t have a clue on “How to look for it”. This article will help you to become “A Good Financial Planner”, where you will be able to organize your money and stay stress-free about “Right Investments”.

Generally, we hear people saying- “I have no idea where my money goes”, “I don’t have anything left to save” or they will be worried about not making “good decisions” on investments or considering not having enough for their children and for themselves in the coming years. One of the reasons why we make such a statement is because we don’t have an efficient cash flow system.

The right way to track your money is to have “a good cash flow system”. You would have seen individuals who will record each penny they go through consistently which is an extremely boring job, eventually they get obsessed about money and will stop enjoying their life. Always note that your planning for money what you have isn’t just about spending, it’s also about monitoring all our cash inflows and outflows.

The aim of having a good cash flow is to separate your savings and spending so that you can keep track of your money. There are 3 accounts where you split your money- Income, Spending, and Saving and let’s give 3 different names to these accounts i.e.,

  • Income Account.
  • Spend-it Account.
  • Invest-it Account.

Now, what happens in these accounts?

Once your salary hits Income Account within a short span you will move certain money, keeping the view of all your possible expenses to Spend-it Account and the money left will be moved on to Invest-it Account.

  • The source of money for your Income Account can be your salary, cash gifts received from relatives, bonus, interest earned from investments, rent received, dividends, etc.
  • Next, you are supposed to move money to Spend-it Account. Have a rough figure of all the expenses, including expenses which you may incur in the future. Rent payment, bills, fuel, etc. these are some of the examples of general expenses. Assume in your family there is an aged old man, you can figure out his medical cost, for such costs you can move more cash additionally.
  • Now, whatever left in Income Account, move it to the Invest-it Account. Remember you should be able to move at least 15%-20% of your income to Invest-it Account.

What we are actually trying to do?

By dividing your money, we can create a system where once your money is in its place, you can easily go on with your monthly moves. In the initial stages, you may find it difficult to adopt and following this system, however, eventually, you would adjust to it and develop a steady financial habit.

Table showing the inflow and outflow for 3 different accounts:

Type of Account Percentage Inflow/ Outflow
Income 10%-15% can be maintained as a cash reserve Salary received, rent received, dividends earned
Spending Not more than 45%-50% EMI, credit card bills, utilities
Saving At least 15%-20% Online investments (or) any future investments.

Is it okay to have Joint Accounts?

Always begin with yourself and you might feel getting everyone into the system is a difficult exercise.

Type of Account Individual joint Description
Income yes No It’s good to have a separate Income Account in case your partner is not helping and not supportive.
Spending No Yes Spending can be joint where both of your credits can equal your monthly spendings.
Saving Yes No Each will have different Invest-it Account, even it can be joint, where the primary holder should be the same on whose name the investment will happen.

Keynote:

Moving money from Invest-it to Spend-it is not allowed. Always try to stick to this rule. In the first three months of this practice, you’ll know what’s going on with your money. You will have an idea about your spending. In case, your Invest-it Account is empty, you’ll know that your spending are more.

Outcomes of the system:

  • You’ll start questioning your spending and you’ll realize how much your spending are going to be.
  • Your Invest-it Account will start growing and you can track your spending capacity.

Putting a label on your money will stop you from using it for other purposes. This is what we call “Mental Accounting” which means that separating money based on the purposes and not using it for any other use. Mental Accounting stops us from seeing the same money for two different purposes. We’re training our brains into doing the right things. We have a good and well-established cash flow. Remember we are not investing yet- so the money in your Invest-it Account is ideal.

What do you do with your savings?

You can’t keep your savings idle, so being constructing your wealth. The first thing you do when you have extra cash is creating an emergency fund to meet the unseen future expenses. Then, later you can start investing in various financial products. Things you can do with your savings are:

  1. Plan for goals like child’s education, child’s wedding, vacation
  2. Investing in fixed-income securities
  3. Put money in high-yield products
  4. Invest in mutual funds
  5. Plan for retirement

With MyWay Wealth, you can make all your dreams come true. MyWay Wealth app helps you to save money for a specific purpose and helps the investors to get into the habit of making “goal-based investing”.

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Every Investor has a need, every need leads to a goal and at MyWay Wealth you can have an investment for all your goals such as Mutual Funds for high returns, Term Insurance to Protect Your Family, National Pension Scheme for your Retirement and various other needs.

Don’t Delay, Start Now!

6 reasons that stop you from being rich

6 reasons that stop you from being rich

We all dream to become a crorepati right? To own a luxury villa, drive the coolest car, provide the best opportunities to our children, enjoy a lavish retirement and to show off our financial status. Then what should you do to achieve this? The answer is simple: its “Wealth Creation,” and that is only possible when you start “Investing.” Of course, it’s natural to be hesitant about investments due to the potential of losing money. However, with wise planning, the results of investing are quite rewarding. Let’s look at some common mistakes that prevent you from being rich:

1. Delaying your investments
Waiting to find the right investment plan will kill your valuable investments years, and it’s impossible to compare/ succeed with a person who has been regularly investing; this is because the biggest pitfall of starting late is that you are missing out on the “Power of Compounding.” Remember what Warren Buffet said, “if you don’t find a way to make money while you sleep, you will work until you die.”

2. Being impatient
One must understand the basic rule of investing: if your goal is within 3-5 years (short term) then you must go for Debt Investments; any financial goal which is five years and above (long term) you must go for Equity. You cannot make money by investing in Equity for less than 5 years. Remember you need to stick to your investments to reap the benefits. Patience is key.

3. Trading!
We are investors and not traders. Even if your investment plan is excellent, moving in and out of your investments will not earn you returns. Instead, you would end up paying more taxes, exit loads, and miss out on the spectacular returns that you would have made otherwise. Remember wealth creation is a journey. Hence, spend time in the market rather than timing the market.

4. Not taking chances
Benjamin Graham once said, “Successful investment is about managing risk, not avoiding it. ” You cannot generate great wealth with Debt schemes alone. You can’t play safe always. If you are young, it’s smart to invest in Equity Funds because you have enough time to forecast any fall in the market and benefit from long term returns. Remember, Equity Funds are known to be the best option for wealth creation over the long run.

5. Ignoring Inflation
Did you know your idle money would make you lose 4.5% every year due to inflation? The only way to beat inflation is to start investing, and it helps in maintaining “purchasing power.” If you want to make substantial returns over inflation, then Equity Mutual Funds should be your choice; they are safer than direct stock markets and earn 12-15% returns on your investments.

6. Not being smart with Taxes
Nobody wants to lose a substantial amount of their salaries to taxes. One easy way to reduce your tax liability is through investments. Investment option such as Equity Linked Savings Scheme (ELSS) not only lower your tax burden but also provide returns between 15-16% (which is way more than PPF at 8%) and has a lock-in period as low as three years only.

Now that you know about the importance of Investing! Why Delay? Start Now!
You are just minutes away to start your journey of wealth creation!