Short Term Investment And Long Term Investment
Hello Investors, In today’s time everyone invests their money in some place or the other to become financially free, that investment can be in FD, real estate, gold, stocks or mutual funds, but everyone’s reason and goal of investing is different, some people invest to buy a product and some people invest to become financially free and make the money work for them.
So in today’s blog we will talk in full detail about what is short term investment and long term investment.
Short Term Investment And Long Term Investment
Short Term investment
So first of all let’s talk about what is short term investment. Friends, short term investment means when you invest your money for 1 year to 5 years, in this our main goal is to buy a product or service by collecting x amount, like if you want to buy a car worth x amount within 4 years, then to buy it you will invest some money from your income every month or every week in stocks, FD or mutual funds, so that the value of your money does not decrease due to inflation, and then after 4 years you will buy that car.
But what will be the benefit of making a short term investment in this?
So the first benefit is that if you do not invest, then you will have to pay Rs 2.5 lakh more to buy a car worth Rs 10 lakh. The car that you want to buy for Rs 10 lakh, you will have to pay Rs 2.5 lakh more after 4 years from today, because every year the value of your money will decrease by 6% due to inflation.
Short Term Investment And Long Term Investment
But what will happen if you invest, let’s see,
If you invest your money in stocks, mutual funds or gold for the next 4 years and you get an average return of 12% every year on it which is very easy to get in India today, then after 4 years you will have ₹300000 more, that is, because of the investment, you will be able to buy a car worth 13 lakhs in the same amount instead of 10 lakhs.
Friends, this is the benefit of short term investment, if you want to buy a phone, car or house in the coming 5 years, then you can make short term investment.
Now if we talk about the right investment options for short term investment,
If you do not want to take any risk then you can invest in FD,
But if you can take a little risk then you can invest in gold and mutual funds, in which you will easily get 10 to 15% return every year,
Apart from this, stocks and real estate can also be a good option, but you should invest in it only when your vision is more than 5 years and you have good knowledge about it.
Short Term investment And Long Term Investment
Short Term Investment And Long Term Investment
Long Term Investment
Now let’s talk about long term investment. Friends, long term investment means when you invest for more than 5 years, your main goal is to make the money work for you and become financially free as soon as possible. In long term investment, it’s all about time. The sooner you start investing, the more profit you will make.
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For example,
if you invest ₹10,000 every month and get an average return of 20% every year,
then after 5 years you would have invested ₹6 lakh and at the rate of 20%, the value of your money will become 10 lakh 34 thousand rupees,
after 10 years you would have invested ₹12 lakh and at the rate of 20%, the value of your money will become 38 lakh 23 thousand rupees,
after 15 years you would have invested 18 lakh rupees and at the rate of 20%, the value of your money will become 1 crore 13 lakh rupees,
that is, after 15 years your portfolio will go above one crore, this is the benefit of long term investment.
after 20 years you would have invested 24 lakh rupees and at the rate of 20%, the value of your money will become 3 crore 16 lakh ₹14 thousand rupees. Short Term investment And Long Term Investment.
In the example, we showed you a return of 20%, but no bank gives a return of 20%, for this you have to invest your money in the best place,
For example, if you do not have enough time to understand the business model of the company or understand the fundamentals, then you can invest in mutual funds,
Secondly, if you invest your money in stocks with a little knowledge or after watching this video, then you can get more than 20% return,
Thirdly, you can invest in gold,
Fourthly, if you have good knowledge about real estate, then real estate can be a good investment option for you.
Short Term Investment And Long Term Investment
So friends, I don’t know in which of these two and how much money you will invest, but I would like to tell you this, you should invest 10 to 20% of your income for long term needs so that you can make the money work for you.
Short Term Investment And Long Term Investment
Short Term Investment And Long Term Investment