Invest your salary in mutual fund is what our elders didn’t taught us as Gold is most safest option was there in there time.
It is good if you think to invest your salary in mutual fund, this way you investment will be diversified. In India almost 60% of the whole population is employed.
Since, you are a salaried person like me I know how difficult is it to manager all your expense and save some money for investment.
The first thought that comes to mind after receiving a salary is whether to invest any leftover money. Over the past few years, returns on conventional instruments have been gradually declining. As a result, one needs to start considering alternative market investing alternatives.
One of the best investment possibilities is mutual funds. You can select mutual funds based on your time horizon and risk tolerance.
Establish your investing objective before beginning to invest in mutual funds. Your understanding of the investment’s time horizon will be influenced by its aim. Planning can be done over a short period, such as one to three years, or a lengthy period, such as more than five years.
Equity investments should typically be made for the long term, whilst debt funds are better suited for the short term.
In this blog we are going to see where you can invest your salary in mutual fund
Checklist before Investing your salary in Mutual Fund:
Everything in the world of finance is based on planning and forecasting. The same essentials that can help you earn great returns on your investments are needed here as well.
Goal before Investing your salary in Mutual Fund
Your objective must be made clear. You should be certain of your financial aim before making any investment, not only when investing in a mutual fund.
Additionally, you must decide how long you will invest in mutual fund in the strategy. Because mutual fund companies provide both short-term and long-term schemes, time horizon is equally crucial.
Risk
Understanding the risk profile is necessary. Before investing in any financial instrument, whether you are acting on the advise of a financial advisor or not, you should be aware of your risk tolerance. From one to another person, it differs. You need to consider the your risk capability while investing your salary in mutual fund.
Asset Allocation
Knowing the risk profile will make it simple for you to decide which is best for you. Whether it involves investing in debt or stock, or a combination of the two?
And many more factors, You can read this guide to know more about those factors.
Tax Benefits
You need to make sure that your investment should fullfill the tax slab of your income.
Equity-Linked Savings Schemes, sometimes known as ELSS, are tax-advantaged equity-oriented savings plans. Under section 80C, one may deduct up to Rs. 1.5 lakh. They have a three-year lock-in period. Equity fund investments should be made for the long term, ideally between five and ten years. If you invest your salary in mutual fund like these then you will be able to save more of your income.
Investments in high-risk funds including mid-cap, flexi-cap, and sector funds may be preferred by aggressive investors. Multi-cap funds invest in businesses with a market capitalization of more than 5,000 billion rupees but less than 20,000 billion rupees. These businesses have a colossal potential for expansion. In 3-5 years, they might produce large profits.
Some Schemes to Invest your Salary in Mutual Fund.
Parag Parikh Flexi Cap Fund
This is one of my favorite fund where i have invested my money. This fund is ideal for long-term investors and you can start investing in this scheme by Rs.1000 per month. This fund is managed by Mr. Rajiv Thakkar. However, an average of 65% of its corpus will be invested in listed Indian equities to take advantage of the preferential Capital Gains tax treatment provided to such schemes. You can invest your salary in mutual fund like these who have high-growing opportunity.
INVESCO India Tax Plan Direct-Growth
A wise financial decision is to invest in INVESCO India Tax Plan Direct-Growth, an equity mutual fund programme introduced by INVESCO Mutual Fund. A diverse portfolio of primarily equities and equity-related securities will be used by the scheme to produce long-term capital growth. It plans to invest using a bottom-up strategy across all market capitalization sectors.
SBI Bluechip Fund Direct-Growth
The equity mutual fund SBI BlueChip Direct Plan-Growth was introduced by SBI Mutual Fund and is a fantastic mutual fund for financial planning for salaried employees. Through active management of assets in a diverse portfolio of large-cap equities stocks, the programme aims to offer investors chances for long-term capital growth.
If you invest your salary in mutual fund like these then you will be protected from risk.
ICICI Prudential Regular Savings Fund Direct-Growth
One of the Top 10 Investment Plans is the ICICI Prudential Regular Savings Fund Direct-Growth, a hybrid mutual fund scheme introduced by ICICI Prudential Mutual Fund. The plan uses investments in debt instruments and the money market to provide long-term capital growth.
Tata Digital India Fund Direct-Growth
An equity mutual fund programme called the Tata Digital India Fund Direct-Growth was introduced by Tata Mutual Fund. By investing at least 80% of its net assets in equities and equity-related securities of Indian companies operating in the information technology sector, the scheme aims long-term capital appreciation.
Conclusion:
Most of the people first pay their expense then they do investing but what I recommend is that you should first invest your salary in mutual fund, whatever you want to invest, and then you can pay your expenses with remaining money. At starting You will feel some difficulty but trust me it is worth it.
When you invest your salary in mutual fund you are actually diversifying your investment. You actually need a proper investment plan so that in future you can have good amount of money.
By investing your salary in mutual fund you are actually investing time. As the time passes, your investment will grow and it will grow your money. When you are set to invest your salary in mutual fund then I recommend you to do SIP instead of lum-sum investment. The SIP will make sure that your investment won’t be impacted by volatility of the market.
I learned this from a book called “The Richest Man in Babylon” where the author suggested the reader to pay yourself first and later pay other. Which means you first invest for yourself and later you pay your expenses.
The author also asked to pay yourself at least 10% of your earnings.
I hope you enjoyed this guide on Invest your salary in mutual fund.
Till Then,
Happy Learning ! Happy Investing !