How to Grow Money Fast: How to grow money fast? Know those 5 simple and smart ways, which can increase your hard-earned money manifold in a short time. Know the details…
Smart Investment Tips: Everyone wants that his earnings should not just lie in the bank account, but should grow rapidly day and night. But most people fall into two mistakes. Either they lose money due to inflation by keeping the money in bank FD or in an attempt to become rich overnight, they invest the money in fraud or unthinking speculation. If you are also thinking about how to make money fast, then for this you will have to make proper financial planning. Let us know 5 such smart ways, by adopting which you can increase your money fast…
rule of 72
The easiest formula to understand the growth of money is ‘Rule of 72’. Wherever you are investing your money, divide it by 72 by the annual interest rate. Whatever number comes, your money will double in that number of years. For example, if you are getting 6% interest in bank FD, then using this formula it will be 12%. That means it will take 12 years for the money to double. At the same time, if a mutual fund gives a return of 12%, then dividing it will yield 6. That means the money will double in just 6 years. If you want to grow your money faster, it may be better to choose an option that gives at least 10% to 15% returns.
power of compounding
The great scientist Albert Einstein called compounding the eighth wonder of the world. Compounding means ‘getting interest on interest’. If you start a SIP (mutual fund) of just Rs 2,000 per month at the age of 25, then this small amount can turn into more than Rs 50 lakh by the age of 50 with an average return of 12-15%. The sooner you start investing, the faster compounding will grow your money.
SIP in Equity and Mutual Funds
If you want to beat inflation and create wealth fast, then stock market and mutual funds can be the best option. If you have good knowledge about companies, then you can invest in large-cap stocks with strong fundamentals. If you do not understand the market, then you can put a fixed amount like Rs 1,000 or Rs 2,000 every month in an index fund or flexi-cap fund. It can give returns of 12% to 15% in the long term.
Use Step-up SIP
Most of the people start SIP, but forget to increase the amount every year. Step-up SIP can be the smartest tool to grow money fast. For this, all you have to do is that as your salary or business income increases every year, increase your SIP amount by at least 10%. If you increase the amount by 10% every year in a SIP of Rs 5,000, your final fund builds faster than a normal SIP.
Don’t invest all your money in one place
Growing your money fast doesn’t mean putting all your money at risk. Smart investors always keep their portfolio balanced (Diversification). You can keep 60% of your money in equity or mutual funds for faster growth. You can invest up to 15-20% in gold, because when the stock market falls, gold gives security to your money. If you want, you can invest money in digital gold or sovereign gold bonds. After this, you can invest 20% in debt, FD or PPF for emergency and safe returns.
Disclaimer: The information given in this article is only for educational and awareness purposes. This should not be considered as any kind of financial advice, recommendation to buy or sell stocks (Investment Advice). Investing in stock market and mutual funds is subject to market risks. Before making any investment, please consult your financial advisor (SEBI Registered Financial Advisor).