What is the best investment according to your age?

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I know you are afraid of finance because the truth is, we can never have enough money! Plus numbers are boring ad complicated. 

You work so hard to make your family financially secure, and i think you deserve to have enough money to fulfil your dreams. Be it World tour, Higher education or retirement home. and all of this can happen by choosing the right investment according to your age!



Content:- 

  • 3 Investment Factors
  • Top 4 asset classes 
  • The best investment option


Before you begin to choose your investment plan, here are 3 things that you must keep in mind

  1. Inflation: - It decreases the purchasing power of money concerning time. For eg. you have Rs. 100 in your locker today, it will become Rs 95 after a period because of inflation.
  2. Retirement planning:- one day you'll get old and that day you will need more money for medicines and the cost of living will increase and you won't have a monthly income. You should have a good life after working for more than 40 years in the job. To achieve this you should always keep in mind the retirement fund.
  3. Dream/Goals: - Everybody has their own specific goals. some wants higher education, dream vacation or to own a house. so you have to choose the best investment option for yourself. 

Now, keeping these 3 factors in mind lets see what are the top 4 investment categories in the market.


Top 4 Asset Classes

  1. Cash: Cash is money in your hands or in your savings account, it has low risk and low returns (3.25%). but its liquidity is high. 
  2. Debt Investment: These are through FDs and RDs. these have low risk but they come with constraints like lock-in period, missed instalment penalties. While its good to have a small amount in FDs as it is stable
  3. Real Estate: it has low to medium risk and returns are location-specific, additional Maintenance costs and liquidity is very low.
  4. Equity: you should invest in equity to beat up inflation but it could really volatile with medium to high risk. it acts as a long-term investment to minimize losses and equal out the fluctuation.


Age-wise Best Investment Options


Age is a big factor on which your investments depends, and hence your portfolio differs from person to person. But i would give a tip that you should start investing ASAP and enjoy the Power of Compounding. 

Investment is a good idea and always beneficial. but i should warn you that investing do come with risks that are important to get your head around.

Benefits

  • Earning compounded over decades can add up to millions.
  • Diversified portfolios have limited risk long-term
  • It helps promote fiscal discipline.
  • Retirement goals can be one more thing to strike for.

Risks

  • it cuts into earnings, especially for younger, lower-wage workers.
  • Aggressive investing can lead to huge losses in bear markets.
  • It can be difficult to appreciate the value that might be decades away.
  • It can be stressful for risk-averse investors.


The 20s:


Youngsters want to become rich as soon as possible. saving is the last thing they think when they get their first paycheque, they first load themselves up with EMIs.

Financial freedom can only be achieved when u develop a good habit of saving. but then is your saving growing enough money to meet your desires in time? how much interest do you get on your savings account?

Here comes the importance of saving. Though saving and investing are two different aspects but saving is the first step toward investing and achieving financial goals.

Saving and investing can help you to get great flexibility and freedom. it allows to take a break from routine and fund your higher education and see the magic of compounding work.

The 30s:


the chances are that you must have already started investing. however, do not worry if you are yet to begin, because it is never too late. 

Responsibilities grow along with financial planning, and its necessary to have a strategy that allows us to maintain our ideal lifestyle despite increasing commitments. 

In today's world, where there are many alternatives are present, its critical to chart out the identity what is the best investment to make in you 30s that will allow to pursue you your future goals in life.

Here are some investment options you could consider:
  • Direct Equity: investing in equity is surely a high risk considering the volatility of the stock market, but the rewards are likewise if invested wisely. use the formula to see how much you should invest in equity i.e. suppose your age is "x", so (100-"x"% ), whatever the percentage you get should be your amount to invest in equity considering the volatility.
  • PPF account: A Public Provident Fund (PPF) account is often considered as one of the best instrument of investment that is available because they are backed by the sovereign and are a safe investment.it consists of the long tenure of the investment (15 years)
  • Invest in Debt Funds: Debt Funds are one of the best investments in your 30s. as they offer stable growth. Debt funds invest in fixed income instruments such as corporate bonds, treasury bills, and other money market instrument that are not as volatile as stocks.
  • Get a good insurance plan: Most employers today offer some variant Health Insurance however, regardless of whether or not your employer offers this, you should have a good insurance plan in hand. 




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