Monday, March 4, 2013

Mutual Funds - Who should invest?

I think I'm enjoying writing about Mutual Funds. Even though I admit that I cannot equate even an inch to those financial gurus, I 'm beginning to love writing about investments and financial management. Where did I get the courage to write something I don't possess in the first place? Or better yet, this should rather challenge me to walk my own talk. In that case, count me in now. Although I want to make it clear that I don't really envision myself to become one of the richest. At the very least, all I wanted is to become financially stable and independent as I age. I guess this sounds as the more realistic challenge.

Going back to the real intention of this post, I wanted to relate my own view of who should really invest in Mutual Funds.

Who should invest in Mutual Funds?

Anyone can definitely invest in Mutual Funds. As long as you have valid IDs and the required amount for investment, you are in! However, allow me to be more specific and identify the best people who can benefit from Mutual Funds.

Are you an employee who doesn't have the talent and bravery in venturing to entrepreneurship?

If your answer is yes, you are the best candidate to become a Mutual Fund investor.

I'm an employee too and I perfectly understand your sentiments. As they say, we are too complacent and dependent to our tenure and constant supply of monthly income. It's hard for us to let go of job stability.

If you cannot leave your stable job, by all means get an investment opportunity. At least in the Philippine setting, the safest investment opportunity that everyone runs to is a savings account or for some, a time deposit account. However, we all know that the regular bank savings account doesn't yield high profitable returns. When I went to the bank last Friday, I was surprised with the dwindling interest rates of a regular savings account. At 0.25% annual interest rate, how far can your hard worked money earn? If you have Php 10,000 in your savings account, that would mean an annual earning of Php 25. Whoa! It cannot even afford you a decent lunch.

Though to clarify, I'm not discouraging everyone from maintaining a savings account. Savings account can act as a temporary shelter of our investment fund opportunity and at the same time, it serves as a source of emergency funds.

How about entrepreneurs?

The more that entrepreneurs should invest in Mutual Funds! I particularly recognize the owners of SMEs (small to medium scale enterprises). Much of the economy's performance and outlook are fueled by their business activities. In order for them to increase their capital and earnings, I strongly recommend that they consider investing in Mutual Funds. Mutual Funds will provide them another win-win situation. 

Are you a student who has part time jobs or can spare some money from your monthly allowance?

If at an early age you can already generate money aside from your allowance, then consider yourself as lucky to start early. I guess there's no need to explain the benefits of investing early. Aside from receiving higher returns in the future, you can train, discipline and develop the inclination to investing. Although I strongly advise that you maintain a savings account first. Once you have established your targeted savings, then go forth and invest.

Have you received a great amount of money recently?

If you are a healthy pensioner or a beneficiary and is troubled on how to handle your money, Mutual Funds can serve as your initial investment opportunity.

You might be surprised because I consider even pensioners as a potent client for Mutual Funds. Unlike other investment opportunities, Mutual Funds does not discriminate age. Although the earnings of Mutual Funds is very dependent on time, pensioners can still benefit because Mutual Funds can register earnings in less than a year. They can still experience their funds' earnings.  So even though they are bound by the constraint of time, they can still invest. I have also mentioned in my previous post that in cases of death, the legitimate heirs can claim for the fund and its earnings.

For those who have received a huge amount of money and is troubled by the temptation to spend or the fear of losing it, Mutual Funds can serve as your initial safety cushion. The best about Mutual Funds is that it provides you relatively higher earning rates that you cannot easily consume. Though to clarify, I don't suggest investing your full money in Mutual Funds. As always, follow the principle of Portfolio Diversification or simply, don't contain your eggs in one basket. Continuously search for safe and profitable means to grow your hard worked and hard earned money.

In summary, I strongly suggest everyone to try investing on Mutual Funds. But please remember the precautionary considerations I mentioned in my previous post. Any investment opportunity brings a possibility of losses. The only way we can lessen the effect of this misfortune, pray harder, work harder, earn more and like what I mentioned, diversify. Never get tired of looking for opportunities that can increase your wealth and yours truly will do her share by writing them.

P.S. Click here to read my first post about Mutual Funds.

1 comment :

  1. hi diane!
    I highly recommend First Metro. They send daily updates via text and send the OR within a week unlike other MFs

    ReplyDelete

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