Contrary to what people believe, you do not need to have a lot of money to start investing. In fact, you can have as little as Php 5,000 in your account and you can already dabble with a type of investment called mutual funds.
Mutual funds is when your money is collected to join a larger pool of funds, and a professional fund manager manages this. The manager’s goal depends on the mutual fund investment you have chosen, which is usually a choice between long-term growth investments or short-term ones. The biggest advantage for this kind of investment and the reason why a lot of people are choosing it is because you do not need a large sum of money to start it.
This is also the perfect investment for people who may not have time to manage a diversified portfolio or have the capacity to do so. Mutual funds allow you to sit back and watch the numbers while a fund manager handles your money, whereas directly investing in stocks or bonds would mean devoting time to manage your holdings.
However, before you start investing in mutual funds, here are a few things you need to know.
You have to know what your goal is
Before anything else, you need to know why you want to put your money in mutual funds. For some people, it is as simple as being able to earn money quickly. This is all well and good, but having objectives can help you choose the right mutual fund for you. There are a variety of funds available for you depending on what your preferences are. There are bond funds, stock funds, and money market funds. Discuss with a financial advisor or an investment coach what you want to achieve with your investment and explore options with them.
Research the mutual funds available in the market
The good news is, your bank probably offers mutual funds, so if you do not want to look further than that, you can always choose to invest there. However, if you want to look at various mutual funds that are available in the market, you can always check out a list of official or national investment fund groups.
You can ask your investment advisor where you can start your research if you do not know of any official investment associations. Make sure to study the historical performance of the fund as well as fees that need to be paid; and when choosing a fund manager, make sure that they are more than capable of handling your money.
Create an investment profile
An investment profile will allow banks and brokers to assess which funds are perfect for you. This means that you will have to fill out forms and submit requirements ads you are opening an investment account.
Collaborate with your manager
Just because your fund managers have taken all the responsibilities to make sure your money grows does not mean you need to stay on the sidelines. Monitor its performance periodically by looking at the data which your manager should give you access to. Remember, though, that fluctuations do happen, so do not panic when you see a dip because it normally happens.
When investing, always revisit your financial objectives to see if you are meeting them. At the same time, it allows you to assess if you are capable of making more investments. More importantly, choose an investment coach that will always take your goals into consideration when giving you advice. They should also introduce you to offers and promos where you can save money, just like PAMI’s Summer Shop or Go Promo. Promos like these make your investments policies more rewarding.
My husband and I also started investing in MF a few years ago and I can say it’s a good form of investment rather than keeping funds in the bank. It’s also good to have an Emergency Fund prior to investing because we cannot depend on the funds we invested if we need money urgently. 😉
Hubby and I we are always talking about investment. We always consider the opinion from others. First we need to create goals also and the profit. I think this post it is helpful. Thanks!
I am among those who are not financially healthy and educated. But I am trying to know more about this “world” little by little. I learned that it’s important to have an emergency fund and that’s what we’re trying to do right now. Over the weekend, I learned about iutf (if I’m not mistaken) and I am interested on investing in that.
Financial independence is our goal. this type of info brings us closer to that goal. Thank you!
We are actually a step closer in our goal to finally invest (still need to cushion our emergency fund a bit more) and mutual funds are actually one of the options we are considering to look into. This is very helpful and will share this with hubby. Thank you!
My husband and I need to build our emergency fund first. We have money in the bank (not a lot hehe) but I would like this it to be divided to savings ans EF. I have always wanted to invest in MF. Hopefully this year we can make it happen
We’re thinking of investing Mutual Funds. Thanks sa tips, Mare!
I am still a newbie when it comes to funds and these are great information to start with. Will be sharing this with my husband also.
It’s my goal to invest to passively earn. Mutual funds was once of the options presented to me. Hopefully I can get to it soon,
Same here, it’s nice to have a passive income.
Yes,I learned that you should not put all your eggs in one basket.