Investment Plan Tips- How Homemakers can Make Most of their Idle Cash
It is wise for homemakers to invest the money that they have saved. This is because investments can earn them gains.In this article, we will discuss a few investment tips to help homemakers earn high returns with the money they save.
Most homemakers save a lot of money every month. Instead of saving this money and earning no returns, they can invest it in different investment instruments. The investments can help build a substantial financial corpus. However, it is important to have a financial understanding to make good investment plans. They need to understand their risk appetite, investment goals, and investment tenure before starting to invest.
With that in mind, here are a few tips that can help homemakers earn returns with their savings-
- Plan According to Different Phases of Life
The requirements in life change as we grow old. Hence, it is essential to take investment decisions based on different phases of your life. For example, if you are in your 20s, then you might not have a lot of responsibilities. Hence, you have the right age to take higher risk with your investments. Furthermore, you can invest for a longer tenure. If you are in your 30s, then you might become a parent. In such a case, you can look for low-risk investment instruments and invest in life insurance to secure your family’s financial future.
- Understand Different Financial Products
There are various investment instruments. You need to choose an option based on your investment goals. By understanding financial products, you’ll find out which instrument is right for your goal. Once you select the right investment, you can earn significant returns.
- Create Financial Goals
While creating financial goals, you need to understand how much time you want to stay invested and how much you want to invest. You need to ensure that your projections to reach the goal are 80-90% accurate.
These tips are helpful, but you also need to know what are the investment instruments that can benefit you. Here are a few investment options-
- Direct Equity
To invest in direct equity, a person needs to have a high-risk appetite. It might be difficult for most homemakers to technically analyse a company’s performance in the stock market. However, by understanding the quality of the product, a homemaker can understand which company can benefit him/her.
- Mutual Funds
Mutual funds are one of the most popular investment options. The ease of buying and selling and the option to choose from a variety of funds make mutual funds a good option. Furthermore, mutual funds can be purchased based on risk appetite. For example, if a person has a high-risk appetite, then he/she should consider investing in equity mutual funds. However, investors with a low-risk appetite can invest in debt mutual funds.
Bonds are fixed-income products that have a coupon/interest rate. They have a fixed maturity period. Such products are right for investors with a low-risk appetite.
Keep the aforementioned points in mind while creating an investment plan.