{"id":19828,"date":"2021-04-15T08:43:15","date_gmt":"2021-04-15T08:43:15","guid":{"rendered":"https:\/\/tata-blog.osian.dev\/blog\/?p=14936"},"modified":"2021-06-29T07:54:13","modified_gmt":"2021-06-29T07:54:13","slug":"investment-guidelines-2021-2022","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/wealth-services\/investment-guidelines-2021-2022\/","title":{"rendered":"Investment Guidelines 2021-2022"},"content":{"rendered":"\n

As Warren Buffet says, \u201cIf you do not find a way to make money while you sleep, you will work until you die.\u201d And, the one sure-shot way of earning money while sleeping, especially in the coming two years, is by investing wisely \u2013 in safer schemes that are also money multipliers.<\/p>\n\n\n\n

Sounds easy enough?  It’s not unless you consider these five steps before investing in 2021-2022.<\/p>\n\n\n\n

Step 1# Determine Your Future Goals<\/strong><\/h2>\n\n\n\n

Perhaps you want to buy several things in life. If you are younger, you often aim to purchase a house, travel around the globe, start a retirement fund, etc. As you get older, you might want to save enough for your child\u2019s education, your medical expenses, etc.<\/p>\n\n\n\n

Achieve these milestone purchases by identifying and listing them down early on. Build a corpus of short and long-term investments to reach said goals on time. In a nutshell, figure out what you are investing for and the amount of money required to reach them.<\/p>\n\n\n\n

Step 2# Map Your Investment Timeline<\/strong><\/h2>\n\n\n\n

After identifying your future financial goals, calculate backwards the amount of time you\u2019ll need to reach it. For instance, suppose your child is presently a year old, you will need to start saving up for their school admissions and fee within the next two years.<\/p>\n\n\n\n

Calculating the timeline of your financial goals will also help you figure out whether it\u2019s a short, mid or long-term goal. Once you are aware of the timeframes, you’ll know when and how much money should you invest to achieve a specific financial milestone.<\/p>\n\n\n\n

Step 3# Asses Your Risk Appetite<\/strong><\/h2>\n\n\n\n

This is a critical tip for any year you invest in! As an investor, you must carefully evaluate your tolerance for risk. Doing this will help you decide which investment instruments you choose and the ones you will reject.<\/p>\n\n\n\n

It’s no secret that most financial products offer high returns at more risk, while others provide lower returns at low or zero risks. Deciding between these two conditions is always tricky. To counter the confusion, experts recommend you diversify your financial portfolio. Make sure you have a bunch of low risks and return investments as well as high risk and returns investments.<\/p>\n\n\n\n

You can also diversify within an instrument \u2013 go from low risk to high risk. For instance, if you plan to purchase mutual funds, choose from a mixed bag. Meaning, invest in a bunch of low risk and return mutual funds, medium risk and returns mutual funds and high risk and return mutual funds.<\/p>\n\n\n\n

Step 4# Invest in Different Asset Classes<\/strong><\/h2>\n\n\n\n

Simply put, don’t only invest in stocks, shares, mutual funds, and fixed deposits. Also, add other asset avenues like Sovereign Gold Bonds (SGBs), real estate, etc. Remember, having different asset classes ensures you are well-cushioned from market downswings.<\/p>\n\n\n\n

For instance, during the pandemic, gold kept delivering great returns, whereas equities crashed. However, individuals with a well-balanced class of assets made up for what they lost in equities with the help of appreciating gold prices.<\/p>\n\n\n\n

Additional Read:<\/strong> Investing in different asset classes based on their risk<\/a><\/p>\n\n\n\n

Step 5# Invest in the Right Product<\/strong><\/h2>\n\n\n\n

Before investing, take into reconnaissance the following two things:<\/p>\n\n\n\n