As per the golden rule of finance, you first need to pay yourself, which means nothing but savings and investment for your future. From 10% of your take-home salary when you start earning to 35% of your income when you reach middle age, you should increase your investment amount to secure your future.
As investment comes with a potential financial risk, you should consider the related factors beforehand. And, when you are investing online, you should be more careful. You also should think about the return as well. Interest rate calculator India is a helpful tool that you can use to estimate the return.
Here are some factors that you should consider while investing online –
- Timing of your investment
One of the golden rules of investing is to understand the way to use your money efficiently. Also, it is important to set your priority regarding your financial liabilities.
For instance, if you have availed any credit from the market, it should be your first priority to clear the credits than to invest in any avenues. You have to understand that if your outstanding is more than your accumulated interest income on the investment, then you can experience financial damages.
However, you can look for Fixed Deposit from Bajaj Finance that comes with a high-interest rate. Use an FD interest rate calculator India to evaluate your return.
Nonetheless, you should also purchase an insurance policy to financially protect you from any loss or damage due to unforeseen events. Also, to create an emergency fund is more important than to invest on a priority basis
- Reasons for your investment
While you are thinking about investing online, you need to first decide the risk profile you can avail of. And, your objective of the concerned investment determines the pathway.
- If you have a near financial goal, then it is preferable to opt for an investment instrument that entangles lower market risks. In that case, you should opt for a fixed deposit. Do make sure to compare the FD rates in India before investing.
- However, if your goal is long-term, you can look for financial instruments with moderate risk factors, like mutual funds.
- Again, if you are investing for a long tenor, you can also opt for a high-risk scheme to experience higher growths.
- Consider your age
After considering your priority and reason, you need to consider your age to fix the amount you can invest and the scheme you should avail.
- Thinking about investment at a young age is an advantage as you have a longer tenor until maturity. Moreover, less responsibility enables you to invest with a high risk that can provide a high return. For better investment, you should know how Indian youngsters are investing. Your disposable income allows you to take a higher risk. Also, with long tenor, you can accumulate high interest on your principal.
- Nonetheless, if you are middle-aged, you should consider a retirement plan with minimal or zero risks. It is crucial to know where to invest to plan your post-retirement life. In such cases, taking advantage of the high FD rates in India can be a wise choice for you.
- Consider time horizon
Based on your choice of investment time, you need to decide the right plan to invest your money. High-risk investments are likely to provide a high return. However, if you are aiming for a limited time, you should look for low-risk options.
As high-risk avenues also come with the potential loss, it may be recovered if you have a long time horizon in your hand. Make sure always to track your investment with interest rate calculator India.
- Risk-taking capacity
Considering high returns are a very common factor while investing, you need to understand whether you are capable of taking the risk of the concerned investment. Instruments like stocks and mutual funds are subject to market risk. Hence, you should consider taking risks only if you can afford the loss.
- Terms and conditions regarding tax
Lastly, one of the most important factors is the terms and conditions of tax implication. Different investment avenues come with different tax implication rules. Before investing, read the terms and conditions carefully.
In conclusion, when you are thinking of investing online, you should go for a reputed financier that has a stable performance over the past years. Also, always use an interest rate calculator in India to forecast your returns on investment.
You cal also read – 5 Key Tips For Online Loans
Other than these factors, liquidity of your investment is also a crucial factor. Whether you can liquidate your investment into cash in times of financial emergencies should also be considered.