Helping Women Gain Control Over Money: A Guide To Making Wise Investments

The importance of financial independence is something that women begin to realise in their late 20s. This is the age when many attempt to figure out how they should proceed with investments as the financial decisions made during this period are arguably more crucial than at any other time in their lives. However, there are too many doubts as one starts navigating their financial journey. 

When there is a lot to choose from, one prefers to make no decision at all. The fear of making poor financial/investment decisions often stops us from taking the first step. To make your life easy, we have enlisted important investment parameters that will help you start your investment journey.

What Does Investment Mean?

To begin with, let us first understand what investment means– investment refers to acquiring an asset to grow your wealth over time. Investing allows you to generate returns on your capital and ultimately increase your wealth. There are various investment instruments that you can consider based on your risk appetite, time horizon, and future needs.

Time Horizon

You can easily classify your investment time horizon into different categories, For example generally, very short-term (less than 3 months), short-term (3 to 12 months), medium-term (1 to 3 years), long-term (3 to 10 years), and very long-term (beyond 10 years). As your time horizon increases, the risk nature of investments can change from money market instruments to short-term debt, long-term debt, and increasing portions of equity. In a growing economy like India, equity asset classes can offer a greater scope for wealth creation over a longer duration as compared to other instruments. 

Portfolio Allocation

Portfolio allocation refers to distributing your money across multiple asset classes, such as equity, fixed income, commodity, etc. The primary purpose of portfolio allocation is to reduce the risk associated with your investments. It's possible that all your assets may not provide similar returns. Some assets that provide market-linked returns may be affected by market volatility. By investing in multiple asset classes, you can aim to manage risk, limit the probability of losses, and improve the possibility of earning better returns.

Risk Appetite

Risk appetite is the willingness of investors to bear financial risk with the expectation of generating potential profit. However, risk varies based on the chosen investment option. Determining the risk levels and the corresponding returns can help you create a portfolio that is more suited to your needs.

Investment Tips For Women

Evaluate your financial goal: Make sure to define your goals so you can pick appropriate investment options suitable for each specific goal. Consider the tenure of your investment: If you will need the funds in the near future, you may choose a short-term investment instrument. However, if your goal is not an immediate one, you can invest in a long-term instrument.

Analyse The Risk Involved In The Investment

Each investment option carries a certain level of risk, which may affect the returns you will receive at the end of the tenure of the investment. Ensure that the risk involved is aligned with your risk appetite. Don't wait for the right time to invest: The only right time to invest is right now. The sooner you start, the higher can be the sum accumulated.

Conclusion

ICICI Prudential AMC offers a bouquet of products in different categories and schemes that are designed to meet your investment needs. For short-term & relatively lower-risk profile investors, ICICI Prudential Mutual Fund has debt schemes with various durations. For diversification and asset allocation, you can look at hybrid schemes and multiasset allocation schemes available with ICICI Prudential Mutual Fund. For long-term and high-risk profile investors, ICICI Prudential Mutual Fund has a lot of schemes in the equity category.

To sum it up, the benefits of investing for women are plenty. You should start investing as soon as you can. With investments, you can enjoy a greater level of financial freedom and can aim to achieve your goals with ease without having to be dependent on anyone.

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.

This article is published in collaboration with ICICI Prudential AMC