We all have dreams that we wish to realize. However, whether it is about going on a world tour or buying a private villa, money is an essential factor for realizing such wishes.
Butthe reality is that you need something more than just your salary and little savingsto realize such goals.
That something is ‘investment.’
Investment means putting a sum of money in an instrument or asset in the present, to earn future profits and returns. This helps you build your finances for realizing your goals and plans.
This way, investments bridge the gap between your present reality and future goals. But still, too many of you, hesitate to make investments. Therefore, let’s help you understand investments better:
What Are the Benefits of Investment?
1. Offer high returns: Investments bring you returns at compounding basis. It is because they take the value of time into account and pay you money for the same. When you make regular investments, you can earn substantial compounding returns this way. Therefore, the earlier you start, the more it shall benefit you.
2. Secure family’s future: Investments create a pool of funds for you that can support your family on many fronts. While health insurance and term plans secure your family against challenges, when it comes to your kid’s higher education or other such plans, then investments can help you meet such expenses easily.
3. Help Reduce Tax liability: Many tax savings investments also reduce tax liability. Equity-linked savings scheme, ULIPs, and other such plans not only bring you returns but also save a part of your income from the tax devil. Therefore, it is advisable thatyou buy tax-benefit investments to save your income.
4. Achieve your goals: Additional income through investment can help you finance all those dreams you may have long held on to. You can invest in ULIPs plans, endowment plans, etc. that can provide you with huge sums of maturity benefits. You can easily utilize this sum of money to meet the expenses associated with such goals, without disturbing your savings and monthly earnings.
5. Improves spending habits: It is seen that those who start investing from a young age also develop good spending habits. This can help you spend in limits, enabling you to make wise choices. Moreover, this can also help you in saving more than before.
6. Improves the quality of life: Another essential benefit of investment is that itopens new streams of income in your life. It thereby helps your family improve their quality of life.
How to Make the Right Investments?
1. First thing before investing should be figuring out your goals and risk tolerance. This will help you plan your investment portfolio better. Taking this approach will enable you to save just the right amount for your goals, without compromising on your savings and emergency funds either. Also, if the goal in front of you is long term, then you should go for long term investments. Moreover, if your risk appetite is less, then you should go for safer options like ULIP, Public provident fund(PPF) and other such plans.
Reputable insurers like Max Life Insurance provide ULIP that can help you achieve both your goals of insurance and wealth creation with a single integrated plan. They provide coverage for 85 years along with the flexibility to switch your money through the policy term.
2. Further, also make sure that you have a diversified investment portfolio. This means that you should have a mix of investments that balance each other in terms of returns and risk involved.
3. When choosing between different investment options, it is preferable that you choose tax saving investments as they will help you save your hard-earned money.
So, now you know the benefits and the way for making the right investments. Therefore, it is important that you start investing without any more delay. The investments will help you realize your goals in a much easier manner than if you continue to rely on your monthly salary and savings.
Plan well, invest early, and achieve your goals quickly!