Investing in the stock market is easier than ever. You can get all the information about the market at the click of a button. You can track the movement of Sensex and Nifty on a daily basis. Things have become very simple nowadays. In this article, we will deal with why you should invest your money.
1. Grow your money
We all want to grow wealthy. When you have money you get freedom to do whatever you want. The easiest way to grow your money is investing. However, you are not limited to invest in the stock market. You can invest in stocks, bonds, government securities, etc. There are so many avenues available for you. The best thing about investing is that your money works for you. Compounding will increase your wealth slowly and gradually. To enjoy the benefits of compounding you should start investing as early as possible.
2. Create your retirement fund
You should always think long term in the market. What will you do after you retire? How will you finance your daily expenses? Creating a retirement plan is the best gift you can give yourself. If you start investing even ₹2000 monthly for the next 40 years of your life, you would create a massive corpus for yourself. When you are young you can take more risks. You can invest in growth stocks. As you age, you can shift more towards blue-chip stocks and bonds.
3. Earn higher returns
Even the best FD gives you only 6% return annually. This is not enough to defeat inflation. Inflation decreases the value of your money over time. The only way to beat inflation is to invest in the stock market. Here you will get higher returns than any other investment avenue. The benchmark index of Indian stock market, Nifty has given a CAGR return of 12% since its inception. It is almost double of what you get from FD. If you are skilled enough, you can beat the market and earn even higher returns.
4. Reach financial goals
Stock market has the potential to bring all your dreams to reality. You can buy a new car, a house or fund your next world tour from the money earned from the stock market. You should first find out the reason behind your investment. You want to create a retirement fund, want to buy a car or a new house, go on a world tour with your family, whatever it may be, you can plan your investment according to that.
5. Be part of the business
When you buy the shares of a company, you are essentially buying an ownership in the company. You become a part of that business. Not all of us can be businessman but we can be shareholder of the company we like. This way our funds will grow along with the company.
To sum up Investing in the stock market has become a necessity now. However, you need a demat account before you start your journey in the market. You can open a demat account with 5paisa.