The world is currently under the transformation mode where many fundamentals have undergone significant changes. Lives of the humans was first challenged the Covid Pandemic since early 2020 and now the war between Russia and Ukraine are challenging the humanity.
At current juncture, the world is in midst of a critical situation where the inflation is on fire while growth is still laggard. On the flip side, the India has fought bravely with the pandemic and now is also tackling with the global situation in a very professional way.
We are now in the mid-month of October 2022 under the joy of the festive season where festival of lights is right around the corner. Apart from the above-mentioned pessimistic words, we are still optimistic for the future prospects of the world and also the financial markets. It is always observed the world of investing that the best investment is always made during the bad times and it has also been proved right in the history as well.
Let us keep the dark side of the world aside and start fresh with the new ways of investing. In the current situation of the world where everything seems to be negative, we have to step ahead and find a best way of investment to secure our future prospects and the growth.
The first thing as an investor, we have to first decide our goals then the risk which want to take to achieve them. Afterwards, we have to select the right path from the various options to move forward. Our first goal in the world of investing is to be debt free first and be financial independent.
The definition of the financial planning has to be changed now. Before it used to be as Income minus expenditure is equal to savings but now it should be Income minus Savings is equal to expenditure. Savings should be given the first preference one we generate the income and then it has to be invested in proper asset classes to maximize the returns.
Various broad asset classes currently available for investment for a retail investor:
- Real Estate
- Bank FD
- Debentures and many more.
So, from the above information it is clear that the investment should be done taking risk, reward, age and asset classes in to consideration and not to dive blindly in to the ocean of financial world. Even blind investment in equities without timing it properly with proper asset allocation will lead to very disastrous outcome.
It is also to be noted that the returns can/t be generated without taking any risk. So, as an investor we should always be prepared to succumb losses as well. Risk and Reward always go hand in hand and can’t be separated. They can be mitigated and adjusted but can’t be eliminated.
To conclude, let us all take a wise decision from this Diwali and SAMVAT 2079 to start allocating our savings and investible amount in to correct asset classes after consulting the best financial advisors about our goals, the investable capital, the duration of investment, the returns expected and the ways of achieving the financial freedom.
Happy Diwali 2022!