When & Where Should You Refrain from Investing?

Investments set the tone for how good your financial health will be in times to come. Money if invested masterfully in useful resources such as stocks often helps climb the ladder of financial success. But there are times when one should abstain from investing. Along with that, there are stuff where you should not invest in. The reason behind these is the unfair loss of money that you can witness on not following the same. Let’s discuss this critical issue in greater detail.

Let’s Start with – When Should You Avoid Investing?

Accumulating goal corpus requires disciplined investments no matter what. More so when it’s about investing in stocks that fluctuate continuously basis the changing political, international and economic developments. While sustained favourable developments help you earn massively, the opposite of that could shorten your earnings. So, patience is required to deal with varying times.

But when you have achieved more or less the corpus you wanted, better you withdraw the same. For example, you sought a corpus of INR 1 crore by your 60, but you achieved around INR 90 lakh by 57. You could withdraw the entire INR 90 lakh and protect it against further market fluctuations. From there on, you could stop investing in stocks. Keep all the withdrawn sum in fixed deposits that are free of fluctuations.

Now Where Should You Avoid Investing Your Money?

Investing money in the right financial instruments is pivotal to a successful financial journey. But many don’t know the RIGHT instruments for themselves and end up investing in some that fetch them bad results. The right and wrong is decided basis your risk appetite mostly. But some are outright WRONGS. Let’s talk about these.

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Investment NOs Basis Risk Appetite

Risk appetite is one of the important elements influencing your investment decisions. The more the alignment between investments and risk appetite the better the results you will have. Nobody reacts to investments the same way; while some like investing in risky assets, others like conservative investments.

So, if you want to earn massively and can invest in risky assets without losing any mental peace, why then stick to the 5-8% return of fixed deposits? Invest in stocks instead and for a long time.

As told before, if you achieve the corpus before you planned for, take out that and invest in fixed deposits. Similarly, someone with a conservative mindset should not invest heavily in stocks as they won’t feel good seeing their ups and downs.

Surprise! Direct Stock Investments are Not Advised for Some

Investing directly in stocks can help you earn infinite returns over time, yet you’re not advised to do so if you don’t have the investment expertise. Estimating correctly the stock market movements basis national and international developments and taking investment calls accordingly is vital. Else you could lose a lot in no time.

With India’s retail participation in stock investments not so high, many of you may not have that investment sense. But you can still invest in stocks, maybe through mutual funds, to earn high returns. These funds invest in a myriad of stocks and are managed professionally by fund managers. They use their market expertise to take those investment calls that help you earn massively in good times and cut your losses in bad times. The balancing act of these managers helps them win more confidence and rightly so.

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