5 Financial Awareness to Simplify the Investment

Updated: Mar 2

Financial Awareness is the basic thing to understand before applying Personal Finance Management to normal everyday life. This is the mindfulness about economic happenings around us and controls our financial behavior accordingly.

elements of personal finance management

We do it naturally; whenever inflation occurs we shutdown our expenses. This is the normal behavior of earning and spending process but, from investors’ point of view, things turn differently. In inflation, they search for chances to earn profits.

A smart investor makes decisions for investment after examining different factors but, what should a new investor or an earner think to start investing in the money market, keep in mind before starting investment?

Here we are describing Five basic key points for investors to apply to their investment strategy -

5 financial awareness to simplify the investment

1. Invest Regularly:

Even in small units but the investment should be regular. Experts suggest everyone should invest at least 10% of their income.

The other thought behind it, you would invest for a long time. Invest regularly will ensure a greater return in the long term.

The percentage of investment should be increased as the income would so.

2. Understand the Inflation:

You may hear much about it but in simple words, inflation declines the value of money. Your 1000 rupee would be 250 rupees after 30 years. Always invest for the best of the return.

It will possible when you understand your risk-taking ability, which could depend on various factors like your age and income. High risk gives a high return but there is a possibility of negative return so by the time you should reduce the risk for a safe return.

3. Know The Importance Of Financial Goal:

This is the very basic thing to understand before jumping into financial planning.

Remember one thing desire and goal are different things. You decide your financial goal according to your current financial status.

Two kinds of Financial Goals -

Long term goals

  • owning a House

  • self Retirement Plan

  • child Marriage

Short term goal –

  • Buying a car

  • Holiday plan

  • Buying a laptop or any expensive gadget.

4. Know The Mutual Fund and SIP

Nowadays there is so much hike around mutual funds and SIP. Mutual funds are medium and low-risk investment plans in which investors do one-time investments for a particular time.

SIP is a new option for investing in mutual funds. In the Systematic Investment Plan, you can invest in the mutual fund even on a monthly basis with small amounts.

5. Keep Updated

The finance market always keeps the change. The government and various financial institutions keep changing the rules and regulations and percentage of return.

So it is always good to have eyes on these updates because, All happening around the world; politically, economically, or socially, impacts the finance world.

Options to keep update

  • Business news channels

  • Business Mobile Apps

  • Online and Social Media Profile of Finance management organization.

  • Business Magazines.

Recent Posts

See All