The planet has never seen a pandemic like the one we are currently facing. There is a lot of uncertainty regarding the economy and personal financial circumstances right now, but what if I told you that you might learn to invest in a pandemic and any other situation?
Money is one of the most important commodities that will take you through the pandemic. With soaring interest rates, impending inflation, and the economic recovery still not in sight, it is but our own duty to generate and preserve our wealth. In short, there is never been a more crucial time to get into investing and we are here to teach you how.
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Why to Invest?
It’s a beautiful question, and the answer is a bright future. Investing is a method of accumulating wealth that is not restricted to the wealthy, anyone can begin investing. To make your money work for you, investing is important, if not essential. You put in a lot of effort to earn your money, and your money should reciprocate. Investing is one way to take control of your financial future. It helps you to build wealth while still providing an extra income stream in case you need it before retiring.
The following are four considerations to begin investing:
- Livelihood: – The term refers to a way of sustaining life.
- Certainty: – A way for managing the future and making the environment less unpredictably unstable.
- Position: – To create, retain, and improve the status, you should invest.
- Accretion: – In and of itself, the idea that more is better.
Where and how should you put up your money?
1. Mutual Funds:
With just a small sum of the amount, you can begin investing in mutual funds, interesting right? Even if you just accumulate near about ₹500 to ₹1000 in mutual funds, you can own a portion of a basket of expensive stocks.
While the returns are diluted as compared to direct equity investments, if you believe in and want to invest in megabrands, mutual funds mean that you get a chance even if you just invest a small sum. Compounding is the process of generating new returns from existing ones. Because of compounding, your investments rise at a faster rate over time than if you invest late.
- Investment in Mutual Funds can be done through Mobile Applications like PayTM Money, ETMONEY, Groww.
- Log on to application and create an investment account.
- Fill in all the required details.
- Have your e-KYC done now; the whole procedure takes just 5 minutes.
- You’re good to start investing.
Investing in the stock market allows you to potentially receive higher returns on your money. As a result, investing here allows you to compound your money over time and accumulate capital for different life goals. If you buy shares in a stable company and keep them for a long time, you will amass a sizable fortune for yourself.
Stocks is the major platform to invest, even if you start with Rs 1000 per month, you can invest in stocks and build a good portfolio. Even if you just buy a few stocks, if you do your homework and invest in a financially sound business with a 7–10-year investment period, you will see results.
Given a 10% chance of a 100 times payoff, you should take that bet every time.
— Jeff Bezos.
To begin investing in stocks, follow these steps:
- Obtain a PAN Card: PAN card is mandatory to start investing in Stocks.
- Obtain a Broker: Brokers are people who are allowed to buy and sell on the markets and are approved by SEBI. A person cannot go and buy Stocks directly without a broker. Start investing with these verified broker applications – Kite Mobile App by Zerodha, Groww, Upstocks.
- Obtain a Demat Account and a Trading Account: After opening an account in any application, you now need a Demat and Trading account. Basically, the Demat account will hold the stocks or shares in your name, and the buying and selling of shares you wish to have or want to sell will require a Trading account, these accounts can be opened through the same application.
- Buying and Selling: To buy or sell shares, you must tell your broker which share you want to buy in what quantity and at what price. You can use the mobile application or you can call their customer service.
3. Recurring Term Deposits:
Most banks have a product called a “Recurring Term Deposit,” which allows you to deposit a set amount per month and gain interest at deposit rates. Customers can spend an amount of their choosing each month and save money with ease thanks to recurring deposits (RD). Most Indian banks and NBFCs offer recurring deposit accounts with terms ranging from six months to ten years. The interest rate is normally between 5.00 and 7.85 percent.
Here are the steps you need to know:
- Install the India Post Payments Bank (IPPB) app on your device.
- Using the app, open a post office savings account: Fill in the necessary information, such as your phone number and PAN card number. OTP is used to verify the mobile number.
- Enter your Aadhaar number and confirm it with an OTP.
- Complete the online application.
- You’re all set to start investing.
4. Public Provident Fund
PPF, or Public Provident Fund, is one of India’s most common saving plans.
The funds in the PPF account and the returns it earns are assured since it is controlled by the federal government. PPF is an obvious option for those looking for stable and assured returns, with a minimum investment of just ₹500 per financial year.
A PPF account can be opened in only designated bank branches of –
- SBI and its subsidiaries
- ICICI Bank
- HDFC Bank
- Central Bank of India
- Bank of India (BOI)
- IDBI Bank
Step 1: Go to the internet banking or mobile banking website and log in to your account.
Step 2: Pick the ‘Open a PPF Account’ option from the drop-down menu.
Step 3: Choose the ‘Self Account’ option if you are creating an account for yourself. You can choose the ‘Minor Account’ option if you’re opening the account on behalf of a minor.
Step 4: Fill out the application form with the necessary information. Check the information you’ve entered.
Step 5: Enter the cumulative sum you plan to deposit in the account over the course of the fiscal year.
Step 6: Submit the application form and your account will be created.
5. Digital Gold:
Any e-wallet platform, such as Google Pay, Paytm, and PhonePe, can be used to invest in digital gold. Digital gold can also be purchased from HDFC Securities, Bajajfinserv, and Motilal Oswal. These websites and businesses exist solely to serve as a forum for the trading firms MMTC-PAMP, SafeGold, and Augmont.
These apps and websites merely act as a link between trading platforms and investors. When an investor buys gold on these websites, the trading firm deposits an equal amount of actual gold in the vault in the investor’s name. As a result, all investors need to do is invest in gold on these sites, and the trading firms will handle the rest.
You may get the gold delivered to your home or office. You can start investing with as little as ₹1.Digital gold can be used as a type of online loan collateral. The purity of Digital Gold is 24K 99.5 percent for SafeGold and 999.9 percent for MMTC PAMP purchases. Your purchase is held in a secure location and is fully protected. Digital gold can be exchanged for physical jewellery as well as gold coins.
To achieve your objectives, you must invest. It’s the only way to improve your prospects. You are also investing and accumulating a fund for a rainy day by making investments. Aside from that, making daily investments allows you to set aside money on a regular basis, which helps you develop financial discipline over time. You should get your investments underway as soon as possible.
The best thing about investing right now is:
- You’ll see an increase in the value of your money.
- There will be more capital with you to put into the market.
- You’ll learn to be more frugal with your money.
- Stress-free about the money.
- You can be confident that your retirement would be more secure.
Time is money when it comes to investments. The quicker you get started and the longer you stay involved, the higher your returns will be.
“Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.”