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In this edition of Money Guru, Zee Business News Anchor Swati Raina speaks to personal finance experts Prableen Bajpai, Founder of FinFix and Priti Rathi Gupta, founder Lxme to know the 9 mantras of investment, this Navratri.
Start your investment from this Navratri
The Goddess of Wealth – Lakshmi will bless you
Which mistakes to avoid while making investments
Where to increase wealth from?
Know these 9 mantras:
Movement in Rupee
Rupee is witnessing huge fall against the US Dollar
The rupee has fallen over 50 per cent over the last 10 years.
In 2022, Rupee has depreciated over 8 per cent versus the Dollar
Rupee has seen 9 consecutive months of decline
The Dollar Index has appreciated by over 20 per cent this year
Falling rupee, heavy on pockets
The inflation is set to rise significantly amid the weakening rupee
It is important for interest rates to increase to deal with growing inflation.
Higher inflation will lead to increase in the EMIs
Travelling overseas will become expensive
Studying abroad will become dearer
Health treatment abroad will become expensive
The fall in Rupee is impacting everything
What to do?
Keep in mind currency depreciation while planning to study abroad
1) Diversify your portfolio
Keep in your portfolio, foreign funds and gold
You can take loan to fund your foreign education
You can postpone foreign travel for some time
Always invest in different asset classes
Invest in equity, gold and debt
Never invest more than required in one asset class
Invest in different classes to reduce risks
Put more money in equity while you are young. Rest in debt and gold
Increase your debt allocation as you grow old
Allocate 10 per cent in gold
2) Keep Inflation in mind
See for real returns and not the nominal returns in investments
Real rate of return = Interest rate – inflation rate
Invest where return is higher than the inflation rate
Always consider education inflation
The average increase in inflation in education is 10 per cent annually
Investments in equity will overcome inflation
3) Exit Plan in funds
Never decide on investments based on market movements
It is not always right to book profits when the markets are on a high
It is not always advisable to stop investments on market declines
Trying to time the markets is not the right strategy
4) Performance
Never just focus on 1, 3 and 5 year returns on the investments
Do not always select those funds which are giving highest returns
The last returns may not be the true barometer for selecting a fund
Always select those funds which have the potential to meet our goals
Always analyse the funds based on different market cycles
If the fund has returned better income than the index, then it can be considered as a good fund
Always select a fund based on strong reasons
5) Never take decisions based on emotions
Never stop investing in haste or fears
Look for opportunities on a market fall
Invest in a gradual manner via SIP
Never try to time the markets
6) Emergency Fund
Make emergency to meet expenses up to 6 months
Invest in liquid funds of Debt Mutual Fund
Bank FD, RD or keep some cash
Liquidity a prerequisite in emergency fund
7) Money for retirement
Start planning for your retirement while still under employment
Only 2 per cent women do retirement planning – LXME report
Start investing early. It will give advantage of compounding
Equity mutual fund will give high returns over a long term period
Keep insurance and investment separate
8) Insurance before investment
Always buy insurance before making investments
Stay away from products which look like investment
Always buy health and life insurance first
Invest to fulfill all other investment goals
9) Never try to copy others while making investment decisions
Never try to make investment decisions based on what others do
Not correct to invest in rising market and selling in falling market
Herd mentality not good and may cause losses
Stick to strategy whenever markets are on rise or fall
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