How to Build Wealth, Reach Financial Goals quickly and efficiently?

 

How to Build Wealth, Reach Financial Goals quickly and efficiently?

There is one thing which is inbuilt in the DNA of all Indians i.e. Savings. One advice that we all must have got from our parents is to save atleast 40-50% of what we earn. This is the reason why govt. has made provident fund compulsory which is around 20-25% of our earning (Half from Employee Contribution and half from Employer) so that a reasonable amount is saved to cover cost of living after retirement. This concept has been devised around 100 years back considering circumstances of that time.

Considering Current scenario where cost of living, education, health etc has increased manifold. Saving alone is not sufficient.

Now important thing is to invest the amount saved to increase our wealth and earning options. Gold, Real Estate has been used since long.

Let us review on average Rate of Return earned on various Investment option:

Current Account	0%
Saving Account	3.5%
Gold	5% - 6% (Last 5 year Avg.)
Real Estate	5% - 6% (Last 5 year Avg.)
Fixed Deposit	6% - 8%
Debt Mutual Funds	6% - 7%
Mutual Funds – Indirect Investing in Share Market	12% - 18%
Direct Investing in Share Market	18% - 24%

 

Investing in Share market either directly or indirectly via MF without having sufficient knowledge is very risky and may result in loss.

But in the Long Run it can give you ROI as mentioned above. Let me give you some examples:

-          Sensex increased to Rs. 41306 on 01/01/2020 from Rs. 26366 on 29/12/2016. Approx. 16.5% Annual Return in last 3 years.

-          Sensex has given 12.5 % Annual Return in last 19 years.

-          Axis Bluechip Fund – Growth which is also recommended in my post “MUTUAL FUNDS TO BUY IN 2020”has given more than 16% Annual Return in last 3 years. And there are many other examples.

Conclusion:

-          If someone is having the knowledge to read the balance sheets of the companies and can follow the latest news on regular basis, then direct investment is recommended.

-          If someone is not having such expertise and cannot follow market news on regular basis, then indirect investment via MF is recommended.

-          Please refer my post where some simple and effective points are shared to earn higher returns in share market “Simple and Effective Secrets to earn higher returns inthe Share Market”.

Longer the duration of investment higher will be the Rate of Return. So Start as soon as possible.

Disclaimer - Mutual Funds are subject to Market Risk. Please read the offer document carefully. Do thorough research before investing.