It’s that time of the year when you need to draw out a budget plan for your investments. You can find many budgeting rules on the internet, but ultimately your budget should be personalised to meet your financial goals and needs. Once you have a budget, then you can have a realistic idea of how much money is available to invest.
Archit Gupta, Founder and CEO, Clear said that before investing, you must assess the level of risk you are willing to take. If you are only in your 20s or 30s and saving for retirement, it pays to push yourself to take higher risks because you have the time to ride through the market downturns. And often, taking on higher risk means reaping higher rewards.
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The contribution of the retail investors in the development overall economy of India is remarkable.
Tips to invest for New Year 2023
Stocks
When you are looking to get good returns, you must also be willing to take some risks. On that note, stocks continue to remain the number one option for anyone looking for strong returns by investing in companies/stocks in India and abroad
Vinod Dhama, Founder & CEO, Trading Master said stocks allow you to invest directly in growing companies and benefit from their profits. However, this is a high-risk investment option and those who do not understand markets should stay away from it.
“Stocks are the best choice for anyone looking to invest in companies and earn high returns. With stocks, you can make direct investments in growing companies and gain from their profits, or you can also invest through mutual funds,” said Archit Gupta, Founder and CEO, Clear.
Mutual Funds
A more convenient option or alternative to direct equity (stocks) would be equity mutual funds. By investing in mutual funds, you get to diversify your money across many companies and sectors.
You can seek the help of a mutual fund advisor for the selection of the best funds according to your goals. Alternatives, such as real estate and commodities like gold are also lucrative investment options that can give good returns over time, said Vinod Dhama.
Tax-saver ELSS mutual funds
Tax-saver ELSS mutual funds not only help in growing wealth but also gives tax benefit under Section 80C. A common mistake people make while investing in mutual funds is chasing top-performing mutual funds and frequently switching when they underperform. One must pick those funds that have given consistent returns over the past 4-5 years and stay invested to build a healthy corpus, said Archit Gupta, Founder and CEO, Clear.
Gold
Investing in the yellow metal has always shown to be a successful approach to combat inflation. According to the technical chart, gold is looking very good. Levels 53000-52000 are the best levels for investors to invest in gold for a 10-15% expected return in 2023, said Amit khare, AVP- Research Commodities, Ganganagar Commodity Limited.
Real estate
Real estate, without a doubt, provides the highest return on investment. Nakul Mathur, MD, Avanta India said in order to make a profit, you must select the best period to sell your land or house.
“If you fully understand how and when to invest funds in real estate, they can double their investment in a year. Because it includes an investment in tangible property, the value will gradually rise. Reduced volatility increases the likelihood of real estate investment in your portfolio. In this manner, you will ensure a high long-term return,” he said.
According to Anurag Goel, Director of Goel Ganga Developments, real estate investment is one of the most rapidly growing types of investments. Because funds invested in real estate are spread across multiple sectors. If you want to make a profit in a matter of days, buy land or property, he added.
Fixed deposits (FD), National Saving Certificate (NSC) or Public Provident Fund (PPF).
For people in their 50s who do not wish to take risks, they can opt for fixed return instruments like fixed deposits (FD), National Saving Certificate (NSC) or Public Provident Fund (PPF), said Archit Gupta.
People can also diversify their portfolio to have a balanced return using PPF, which provides a fixed rate of 7-8% as decided by the government, stocks or ELSS, which can give a return of 12-14% in the long term, real estate, gold etc. Insurance, both life and medical, is a must-have in a portfolio. These also carry tax-saving benefits, added Gupta.
So put a budget on yourself, commit to your investment plan in 2023.
