Hesitant about investing in mutual funds? This article is just what you need to get going in your journey of investing in a mutual fund online. It is no rocket science to understand the concept of savings, investments as well as returns. You can not only save money but also grow your wealth by investing in mutual funds from early on. Here are the top reasons why you should start investing in mutual funds right away.
1. They offer diversification
Mutual funds usually invest in two main asset classes i.e, debt and equity. These funds can be pure debt, equity, balanced or hybrid. The most crucial benefit of investing in this option is that you get exposure to a variety of shares and fixed income instruments.
- Most of the mutual funds offer high liquidity
Investing in open-ended mutual funds makes it very convenient for you to buy and sell the units at any time. The total redeemable or buyable value is usually based on the fund’s net asset value (NAV) for that day. Close-ended funds can also be liquid. Even though these funds are for a fixed duration, they are listed on an exchange after the New Fund Offer (NFO) closes. Once these funds are listed on the stock exchange, they can be freely bought and sold. So, irrespective of whether you have bought open-ended or closed-ended funds, there’s always a high level of liquidity attached to them.
3. Higher returns options
Compared to investing in usual term deposits such as Fixed Deposits (FDs), Recurring Deposits (RDs), you should invest online in mutual funds that offer much better returns on the investments. Equity mutual funds present an exceptional opportunity for investors to enjoy higher returns. Debt funds usually offer lower risk but also fetch better returns than term deposits.
- You get the flexibility to invest either through SIP or in a lumpsum
One of the paramount advantages of mutual funds is flexibility. You can either make a lump sum investment or else put in small amounts over a certain period of time through a SIP (Systematic Investment Plan).
5. Mutual funds help in reducing tax liability
One of the salient benefits of investing in mutual funds is that you can save a lot in income tax. If you invest in an ELSS fund, you can get the advantage of saving as much as Rs 1.5 lakh under Section 80C of the Income Tax Act – 1961.
In the end, keeping in mind all the advantages of investing in mutual funds, such as higher returns, increased liquidity, reduced income tax, etc. one should stop worrying about any consequences and start investing online through apps. One such app that is considered one of India’s most trusted online investment platforms is Scripbox. It’s a one-stop solution for your financial planning as well as investment goals. This can act as an excellent sip mutual fund app for all your monthly SIPs (Systematic Investment Plan) or as a One-Time Investment app. The Scripbox app also comes with various other benefits such as 100% paperless KYC process, no transaction fees, live performance tracking, etc. What are you waiting for? Go ahead, start investing and achieve all your goals!