As soon as you decide to make investments to secure your future, you come across different saving options, including mutual fund. Mutual fund is considered as one of the easiest ways of investing money for future. However, there are multiple myths that surround the concept of a mutual fund, which confuses people and restricts them from making investments. To help you make an intelligent decision for future, the myths must be tested against the truth.
Mutual Fund Myths to be busted
Given below is a list of some myths that are necessary to be busted to make sure you invest in mutual funds without keeping any doubts.
Myth 1: Mutual fund investment should be huge
If you have ever come across something like this, it is not to be believed. It’s true that you can invest a large amount in mutual funds but it’s not necessarily to do so. You can make a monthly investment of as little as INR 500 to as much as you can.
Based on the monthly payment, you will be eligible to get a specific large sum after maturity. In case, your level of income increases in the middle of the investments you’re making, you can decide to increase the amount as and when you desire. In mutual funds, you get flexibility so far as the amount to be invested is concerned.
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Myth 2: Be an expert before making mutual fund investment
If you’ve been told to gain expertise by investing here and there before involving into the mutual fund stuff, you’re being misguided. There are so-called well-wishers who want you to be an expert or to have an expert advice before you invest in the scheme. Don’t believe them. You need to research well before you invest in the scheme but you don’t need to be an expert. For everything else, there are fund managers to assist and help you. They will analyze your risk profile and offer you options that best it your financial goals.
Myth 3: Forget short-term profits
There are chances that you are made to believe that mutual funds do not reap short-term profits for investors. If yes, you’re on the wrong track. If you think that investing in a mutual fund will not help you in your rainy days if you need an amount early, it’s not true. You can invest in short-term schemes to reap short-term profits. You know your financial needs better. Thus, it is up to you whether you choose long-term investment option or a short-term scheme.
Myth 4: Returns are guaranteed
If you’re happy that you will get the promised amount after your investment gets mature, you may be wrong. The amount that mutual fund service providers specify while you invest in their schemes is an approximate sum. This sun you are liable to receive after maturity is subject to the market conditions and the change in the rates besides other factors that influence the same. Hence, it is expected that you remain prepared for the changes in the maturity value.
Myth 5: Demat account is a must
It’s not necessary that you have a demat account if you desire to invest in mutual fund. The investment can be made via distributors or by purchasing funds directly from funding institutions.
The above-mentioned myth that might have been restricting you from making mutual fund investment has been busted now. So be free and save for future without any further doubt.