Contrary to popular belief that investment options are only open to the working class, youngsters, especially college-goers, can be the best investors because they have several advantages. While most youngsters in India shy away from investing, considering that they have no other financial burden, investment is a handy option to get richer at a later stage.
Apart from practical knowledge, it is a good idea for students to start investing as it would help them manage their finances better in the future. To assist youngsters who aspire to invest but lack the knowledge, here is a set of tips to help them make good use of their pocket money and stipends.
‚Ä¢ Hold on to money: Often, youngsters tend to spend all their money, considering they have a constant supply of cash. But if college students make an effort to save up a portion of their money and invest. All you need to do is open a brokerage account for stock investments and day trading. Although you will not reap the benefits instantly, investing the money in shares of a company is a good way to aim for long-term returns.
‚Ä¢ Go for low-risk investment options: Young aspiring investors should note that while it is an exciting prospect to invest in stocks and mutual funds, low-risk options should be considered so they don‚Äôt end up losing more money. (P.S. The stock market is full of risks and uncertainties, so it would be advisable if you could take guidance from a broker or a senior family member while going for an investment plan.) As a young investor, the first thing that you should consider is the fact that the stock market involves risk, but those can be tackled if the risk tolerance level is balanced. A planned investment can get you a decent return. It is advisable that youngsters go for long-term investments.
‚Ä¢ Calculate your risks and margins in advance (estimate): Calculation is the key to success when it comes to investment. For the daring lot, who are willing to take an extra step to earn more, calculations are really important. While you should be ready to tackle financial hits, choose multiple investment options to balance the equation.
‚Ä¢ SIPs in mutual funds: This is one of the best investment plans for youngsters, as it offers the lowest risk and the biggest return. A systematic investment plan is one of the smartest ways to eliminate loss. It may be noted that SIPs will allow youngsters to deposit a pre-determined amount ‚Äì on a weekly, quarterly or monthly basis) and is recommended by most tax experts for early investors. However, this kind of investment is mostly for individuals looking at long-term investment plans.
‚Ä¢ Never forget background research: The most important guideline that college-goers and young investors need to follow is background research; considering that there are reasonable risks involved in managing investments, one must do his/her own background research before diving in to invest. For starters, youngsters should check out how the company, which they plan to invest in, has performed on a yearly and quarterly basis. While past performances can‚Äôt dictate future results completely, it does give an indication of the firm’s future curve. At a later stage, you could even check market trends, which are provided by almost all top business news channels.
‚Ä¢ Never get carried away: Last but not least, one should never get carried away after a brief success. The stock market is a vulnerable yet addictive place; you have to be careful as an investor as to know when to pull out of the market and when to advance. Often brokers would request you to invest in another scheme, but you have to remember that the final authority lies with you.
Personally, I recommend HDFC securities as I myself started investing at the age of 18 and HDFC securities really helped me go about it at that age. I assure you perfect guidance and smooth working especially when it comes to youngsters as they are very good at advising and explaining the process of investing in beginners. To start investing early for better returns click on the link given below:https://www.hdfcsec.com/mutual-fund-investment-online?id=lgn