As a young person with a stable income, one of the best investment options you should consider is mutual funds because they are an affordable and straightforward form of investment. But that’s not all there is to gain…
Come along and see more reasons why they’re excellent for you.
Tap into the power of compounding: When you invest in mutual funds, your money grows (compounds) over time, earning returns from existing returns. This means that your investments grow at a relatively faster pace compared to when you invest later. Since mutual funds are easy to buy, they’re a great choice for young investors like you to invest in and benefit from the power of compounding. New to investing? Try the low-risk and affordable Money Market Fund.
Become financially disciplined: Investing at an early age shows that you’re committed to achieving your financial goals. Your youth is the best time to imbibe the habit of being financially disciplined and who knows, many years down the line, you could be the next Warren Buffet or Dangote. Even if that’s not your goal, you’ll be confident with managing and building wealth over time. The idea is to invest with goal-based objectives and start making small but regular mutual fund investments.
Improve your risk appetite: Smart investors invest according to their risk profile. As a young person, you have a better risk appetite due to your long-time horizon. This means that you can choose to be aggressive in your financial plans as they tend to stay flexible. With the longer investment period you have, you can choose to explore plan B if A doesn’t go as planned due to market volatility or spread out your investments. Our financial advisors can help you understand this better.
Wealth creation: When you start investing in mutual funds from an early age, it gives your investment time to grow. By the time you’re older, you’d have built wealth enough to sustain the lifestyle you envisage for yourself. Since you have time on your side, you can also change your investment strategy based on updated financial goals.