A beginner’s guide to investing

When it comes to investing for the future, most people miss the boat primarily because they procrastinate. They just don’t get started due to sheer ignorance or lack of information about where and when to put the first step forward. There is no sure shot formula to become a successful investor. It doesn’t happen by magic either. It happens by setting goals and working to achieve them.

It is imperative to remember that the best time to start investing is right now. Conventional wisdom also states that do not put off until tomorrow what you can do today. If you're new to investing, it can look pretty complicated. But it is easy if done prudently. Investing is a step by step process starting from determining your investment budget, to deciding where to invest.

How much to invest is the starting point of any investment strategy. This is the amount you would keep aside after incurring your routine expenses. This is the amount which you would want to snowball into a big wealth for you.

Investments in provident funds, post office saving schemes, bank fixed deposits are considered to be safe. However they provide a relatively lower rate of return. On the other hand, putting money in the stock market may fetch you high returns. The worry here is that you may end up losing all your money. So where should you go as budding investor.

To begin with, let a mutual fund company do the work for you. This will ensure that you do not spend your time cobbling together a full-blown investment portfolio. You may also ask the fund company to make a tailor made fund for you based on your specific requirements.

Thereafter, diversify and choose a few more mutual funds. By doing so you reduce the chance that problems in any one area will sink your hard earned money.

The main criteria for choosing the funds should be as thus: Strong, consistent performance, low fees and a stable, investor-friendly management company standing behind the fund. Once you've started, track your funds and stocks using the site's portfolio tool or use the portfolio to track stocks you might want to buy down the road.