Over the past few years, investing in mutual funds has become a popular financial asset to grow wealth. However, staying consistent and manually managing the investments may become a little challenging. Investors usually get overwhelmed when they are stuck between tracking market fluctuations and making investment decisions accordingly to maximise returns. To solve this, platforms have come up with automation to simplify the process and help users stay consistent.
In this article, we’ll explore how you should automate your fund investments and pro tips for maximising returns.
Reasons to Automate Mutual Fund Investments
Before diving into the details, let’s start by understanding the reasons to automate the fund investments:
- Regular investments ensure the maintenance of discipline among investors even if the income or the market fluctuates.
- Automating investments helps avoid manually managing portfolios and saves users time and effort. Once the SIP has been set, you can focus on other important aspects of life.
- With early and consistent investment, investors can earn higher returns.
- Automation eliminates the scope of emotional investment and ensures you stick to your long-term MF online investments.
Ways to Automate Your Mutual Fund Investment
Here’s a step-by-step guide to automate your fund investments:
- Choose the Online Platform: Do your research and choose an online platform that is user-friendly, trustworthy, has multiple features and is equipped with advanced safety features.
- Use an Online Calculator: Before you choose a scheme to invest in and automate your SIP, evaluate your returns using an MF calculator. This online tool is available on the investment platform and helps you calculate the potential value of future investments after inputting the investment amount, period of investment, and expected rate of return.
- Choose a Fund Scheme: Assess your financial goals and risk appetite and choose a fund scheme that perfectly aligns with them. Consider factors such as fund performance and expense ratio.
- Set-Up the SIP: Once you have chosen the scheme, decide the amount and frequency of investment. You can start with an amount as low as ₹500, making it accessible and budget-friendly for everyone.
- Link Your Bank Account: The next step is to link your bank account to the mutual fund account and enable auto-debits. This will ensure a consistent deduction of the amount from your account for investment without manual intervention.
- Track Performance: Even though you have automated the SIP, it is necessary to monitor and track the performance and make sure your investments are perfectly aligned with your financial goals. Use an online calculator to estimate your returns over a particular period and regularly track your profile to check if it needs any adjustments.
Tips to Maximise Your Mutual Fund Investments
Follow the tips mentioned below to successfully make your investments and maximise your returns:
- Start Early: Make sure you start investing in mutual funds on an early basis to get an advantage of compounding. Starting early will offer you more time to grow your investments and earn higher returns.
- Be Consistent: Stick to your SIP schedule and avoid making emotional decisions. Consistent investment in long-term schemes helps to grow your wealth even when the market is down.
- Diversify Your Portfolio: Avoid putting all your money in one scheme and spread your investments in multiple assets to earn maximum returns within reduced risk.
- Choose the Right Fund: Analyse your financial situation, goals and risk tolerance to choose the best MF online.
- Stay Informed: Keep yourself updated on the latest market trends to make the right decisions at the right time.
Final Thoughts
Automating fund investments helps you stay consistent and earn maximum returns. When choosing the right mutual fund platform, ensure you choose a trusted one like Bajaj Finserv. It has over 1000 schemes and allows ease of registration and portfolio management. Use online calculators to estimate returns and follow the above tips to maximise your investment returns.