Five Investment Mistakes You Should Avoid, It is important to build wealth and invest wisely. Choosing suitable financial instruments, deciding the investment period are things to think about while deciding the investment strategy. Attention should also be paid to the risk aspect. Strategies should also be adopted to maximize return on investment. Along with seeking the right path, avoid common mistakes in investing.
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Here are five major mistakes investors should avoid.
DIRECT INVESTMENT EQUITY INVESTMENT: Highly profitable. But. It is a mistake to engage in direct equity investment without sufficient experience. Direct investment should only be resorted to if you have the ability to thoroughly research and buy a stock and have the ability to monitor its performance regularly.
Expansion Strategy: Mutual funds are the best option for retail investors to invest in stocks. In any investment, expansion is emphasized. However, over-expansion should be avoided. It is not good to have too many stocks or funds.
Purpose of Insurance: Insurance is important for protection. But,
While choosing insurance policies, the primary consideration should be the protection they provide. Buying an insurance policy to save tax. Both affect investment returns and insurance coverage.
Emergency Fund: While planning the investment, unexpected expenses and other financial emergencies should be kept in mind. Don't forget to create an emergency fund for such crises. If not, there may be a situation where the investment is abandoned during emergencies.
Credit Burden: Credit needs and credit card usage should be moderate. High debt burden can affect financial responsibilities. Credit card overuse is also a disadvantage, and credit card and bank statements should be viewed carefully.