Investments are seeds sown in present for a fruitful future. Investments are financial planning of an individual where he/she chooses to buy an asset or any fund that multiplies in a couple of years resulting in capital gains. Many people think of investments especially, the working class is active since they have to save tax if they are on a high salary. There are many tax saving schemes and investment plans that an individual can opt.
Types of investments
Short-term investment – Investment for not more than 5 years.
Long-term investment – Investment for more than 5 years.
Systematic investment plan (SIP) – It is a tool of investing in mutual funds and not a product in which you can invest. It helps you distribute your funds and invest smartly and regularly to get the benefits later.
Mutual funds – As the word suggest, it is a collective investment with many investors putting some amount of money thus, forming a pool of money. The only purpose is of investing in securities, bonds, money market, stocks and other assets.
Unit linked investment plans (ULIP) – It is a dual-benefit offer where you have a double benefit of insurance as well as investment.
Pension plans – Pension plans are the savings that a person keeps aside during their employment years and use a certain portion from this amount at the time of their retirement.
Everyone wishes to have a high bank balance and pledges to save some portion of their salary or income. However, it seems impossible with the kind of lifestyle we are heading towards or aiming to have. Until and unless there is a limitation or compulsion, we do not let the money stay in our accounts. Therefore, it is wise to invest. Investment plans have been launched in the market to help the people save some money for the time of emergency. It is a money that can be used productively. Definitely, the benefits are to be experienced in the longer run, however, it provides safety.
Here are some of the benefits of investments.
Safety for future – It is believed that future is uncertain, one should live in present however the fact cannot be denied that a person is at peace only until his/her bank balance is strong. The moment the balance goes down, a person starts feeling insecure. Therefore, a person needs to plan his savings for the future and make it secure.
No chances of loss – Until and unless the market is really down, this money is least likely to go waste. It will always fetch you benefits in some or the other ways. There are rarely any chances of loss.
Extra income – With a timely investment, the amounts from it can be added income. In the case of real estate investment, you can take out rent similarly an investment in the stock market can get you some profit amount if the shares you purchased go up.
Save tax – One of the most used strategies is making investments so as to save tax, thus, getting the maximum of your salary.
Strengthen financial planning – If you have a strong vision with long-term financial goals. This is the most suitable path to be followed and fulfil your goal easily. Multiply your amount and secure your future.
Investments are a wiser way to put the money you earn to a productive use as there would never be a stop to our daily expenses. However, we have to save our future, it is wise we do it now!