After writing so much about Financepeer, i understood the importance of making people aware and cautious about the investment habits. There are so many things which you should take into consideration before you invest your money anywhere. So let’s update ourselves with common mistake the investors make, by discussing on what do you mean by investment? To invest means to give money in expectation of some benefit. When you want to earn some benefit out of your money, you think about investing. You know that you want to invest, but where? what’s the process? what’s the benefit? how to maximize those benefits? Should you really invest? Should you trust the organization or the person you are giving your money with? These are some common questions that comes in the mind of an investor. There are certain common mistakes an investor makes.
Investing is an art. And if invested after a careful study of the recent trends and market condition and size, can yield you great interest rates. But there are certain common mistakes an investor makes when it comes to investing. I am going to list down a few in this blog.
- No proper goal: Defining a goal is very important. You cannot take a decision which involves money without defining a goal. Try and identify as to what is the aim of your investment? Is it saving for retirement? Child’s education? Any other personal investment? Also take into consideration the risk factor in long term investment. (Like Inflation which accounts in long term investment.)
- No diversification: This is one of the most common mistakes people generally tend to do. They lay all the eggs in same basket. People don’t like to change their investment options. If they are getting a good result, they are very content with their plan which is completely wrong. Diversification is the need of today’s constantly changing world. The market has a wide variety of choices in terms of investment. So try and invest in different places for you to realize from where you can maximize your investment.
- Lack of investment knowledge: One of the most common mistake that everyone of us makes is not understanding completely about the kind of investment we are making. Investing somewhere without having prior knowledge about that product might make you fall for scams and high risk of money loss. It is always advisable to have a full fledge knowledge about the service or the product you are going to invest in. You should know the ultimate goal of your
- Not taking the advice: There are so many financial advisors who can guide you for the investment options. Not taking any professional advice when you are making your investment will eventually lend you up in a mess. Having a proper advice is very essential. Consult the financial advisors who can give you n number of options and ways on your investment which can help you to select the most appropriate investment.
- Not understanding the percentage game: This can be a tricky pick. You clearly need to know how much money you are going to get as rate of interest. You cannot blindly say yes when someone say that you will earn upto 37%. Never to fall for such things. Get to know how much will the exact roi will be if you are investing certain amount.
- Taking too much or too little risk: Taking too much of risk might end you up in panic and taking too little risk will fail you to realize the full income earning potential of the investments. Again, consult an advisor who can explain you in brief about the kind of investment you
So these are some of the common mistakes the investor make. Be it someone who is new in the investment field or an experienced person. One must do his homework well before investing in any place because it is your hard earned money.