7 Basic Investment Principles You Must Follow

By BankBazaar | June 8, 2017

7 Basic Investment Principles You Must Follow

To make the most of your money, it’s important to invest in the right places. Even if you have a lot of money at any given point in time, lack of proper planning could see it all go down the drain.

This is why it is essential to stick to a basic set of investment principles in order to see your money grow. Building a diversified investment portfolio is always the best option as it helps minimise the risks involved and gives you a variety of options to invest in.

Additional Reading: How Should A 22 Year Old In India Invest Money?

If you’re unsure about the right places to invest and know little about how to take it further, don’t worry! Here’s a list of seven basic investment principles you need to follow:

  1. Start now

Most of us keep postponing our investment plans thinking we have all the time in the world to carry them out. The most important thing that we tend to forget is that the sooner we start the more beneficial it will be in the long run. No matter how much you’re earning right now, the sooner you start planning your investments, the better.

Additional Reading: Invest Early In Your Career!

  1. Invest for a longer period

Keeping your current financial situation in mind, try choosing an investment plan for a longer period. You need to make an elaborate plan and then be patient enough to stick with it through many ups and downs in the market.

Additional Reading: Financial Strategies For The Young Investor

  1. Consider your long-term plans

Make all your investment plans according to your long-term plans. Invest in order to earn sufficient returns that could tide you over post-retirement or to fund your child’s education. You know your plans better than anyone else so use that to your advantage.

Additional Reading: Investment Plans For Women

  1. Stay on track

The most important thing about making an investment plan is sticking to it. Review your plans on a regular basis and bring in necessary changes if need be. This way, you can minimise your risk and increase your chances of seeing your money grow.

Additional Reading: Habits Of Successful Investors

  1. Consider all available investment options

Choose the right places to invest in by keeping all your immediate expenses and future plans in mind. If you want to achieve your long-term growth objectives, investing in stocks is the right thing to do. Look to diversify your investment portfolio as much as possible.

Additional Reading: Tips For Ideal Portfolio Diversification

  1. Resist temptation

Resist the temptation to withdraw money from your investments every time you think you need to take care of certain expenses. Unless it’s a financial emergency and you need funds immediately, make sure your investments are undisturbed. That’s the only way to see your money grow over time.

Additional Reading: Are You A Disciplined Investor?

  1. Invest according to your risk appetite

Make sure you invest in accordance with your risk appetite. Don’t chase after high-risk investments if you cannot afford to. Sure, the allure of making a lot of money in a short span of time can be very enticing, but make sure you cover all your bases before doing so.

If you aren’t in a financial position to do so, go in for low-risk investments such as Fixed Deposits that will practically guarantee decent returns over a substantial period of time.

Additional Reading: BankBazaar Launches Paperless Fixed Deposit

There you have it! Follow these 7 basic investment principles and you should be well on your way towards growing your wealth over time. Remember, it’s all about being patient and committing to your investment plans.

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Category: Investments

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2 thoughts on “7 Basic Investment Principles You Must Follow

  1. dealask

    nice article, Your investment principle is so good thanks for sharing…..

    Reply
    1. Team BankBazaar

      Hi,

      Thank you very much. Glad you enjoyed it. Keep reading!

      Cheers,
      Team BankBazaar

      Reply

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