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Small Saving Schemes - Tips for investing rightly

13 May 2004

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  • Don't put all your eggs in one basket
  • It makes sense to allow flexibility in your long-term investments. You never know the changes life may bring in course of time.
  • Don't base your judgement on the buying decisions of others. Trust your instincts and you will not have to regret much later.
  • Retirement planning is important. Don't procrastinate. Account for it now.
  • As a stock investor don't get carried away by the company's past performance. It is not necessarily indicative of future performance.
  • Track your fund's performance once you have invested. And see to it that you compare apples to apples.
  • Don't invest in a fund if you do not understand its workings.
  • Don't buy insurance only for tax purposes. Ascertain your future needs and buy accordingly.
  • The Post Office is a good investment avenue. Consider it.
  • Term insurance is the cheapest risk cover you can get. Makes sense to buy one especially if you have borrowings.
  • While investing, preferably read the fine print first and the other details later. The risk factors are mentioned there.
  • Periodically conduct a review of your long-term investments. You may need to invest more or less and the earlier you know of it the better.
  • Invest in stocks only if you can take risks and preferably when you are young. At an old age, making good a monetary loss may not be easy.
  • If you plan to take a safe risk with stocks try the mutual fund route.
  • Always ascertain the cash flow of your investments and invest accordingly.
  • Know that EMIs on housing loans are linked to the Prime Lending Rates.
  • When hunting for a housing loan find out whether it a monthly or a yearly reducing balance you're offered. The monthly is better.
  • While buying insurance know that you have 15 days time to take a decision. You may return a policy within such time if you think it does not fulfill your needs.
  • Housing loan companies are known to not make changes even if your loan is on a fluctuating basis many a times. Monitor your loan account
  • Before deciding on a housing loan, get the terms and conditions clarified on pre-payment penalty, part payment, charges for shifting from fixed to floating etc.
  • In case of a housing loan know that it's a buyers market now. Bargain aggressively for interest rate reduction.
  • Pre-payment penalties on housing loans is history now.
  • Unit linked plans are linked to the sensex. Know that ups and downs of the stock market will influence them accordingly.
  • If you have bought unit linked risk plans, review them at regular intervals. You may consider a shift if your fund is not performing.
  • If you are not much of a risk taker do not buy unit linked insurance plans.
  • Consider investment in mutual funds as part of your short-term goals
Source: dwt BACK

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