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All you need to know about investment planning

  • Dailybhaskar.com
  • Jan 17, 2013, 16:09 PM IST
All you need to know about investment planning
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New Delhi: Planning and saving for emergencies is a neccessity like never before. Once you have saved enough to take care of emergencies, you should start thinking about investing and to make your money grow. We can help you plan your investments so that you can reap adequate benefits and achieve your financial goals. Your success as an investor depends upon your ability to choose the right investment options. This, in turn, depends on your requirements, needs and goals. For most investors, however, the 3 prime criteria of evaluating any investment option are liquidity, safety and return.
 
Investment Planning also helps you in numerous ways, to come up with a comprehensive portfolio. Besides your individual requirement, your investment strategy would also depend upon your age, personal circumstances and your risk appetite. These aspects are typically taken care of during investment planning. It is also known to help you to strike a balance between risk and returns. By prudent planning, it is possible to arrive at an optimal mix of risk and returns, that suits your particular needs and requirements.
 
(With inputs from Bajaj Capital)

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Importance
 
In the simplest of terms, investment planning is about jotting down what your financial goals are, and then prioitizing accrodingly. For example, if you want to invest for funding your vacation next year, don't choose an investment vehicle that has a three-year lock-in. Similarly, if you want to invest for your daughter's marriage after 10 years, don't invest in 1yr bonds for the next 10 years. Instead, choose an option that matches your investment horizon.
Investment Planning is important because it helps you to derive the maximum benefit from your investments. Your success as an investor depends upon your ability to choose the right investment options. This, in turn, depends on your requirements, needs and goals. The choice of the best investment options for you will depend on your personal circumstances as well as general market conditions. For example, a good investment for a long-term retirement plan may not be a good investment for higher education expenses. 
 
In most cases, the right investment is a balance of three things:
 
- Liquidity
- Safety 
- Return.
 
Investment Planning also helps you to decide upon the right investment strategy. Besides your individual requirement, your investment strategy would also depend upon your age, personal circumstances and your risk appetite. These aspects are typically taken care of during investment planning. Investment Planning further helps you to strike a balance between risk and returns. By prudent planning, it is possible to arrive at an optimal mix of risk and returns, which suits your particular needs and requirements.
 

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