Hey everyone, In few months I will be joining my first job and I was looking to start a mutual fund. I'm 21 and I want a mutual fund for 10 years. I'm willing invest Rs.1000/month which is equivalent to $15-16. This makes $180/year and $1800 for 10 years. How much return can I get after 10 years? Do you have any other suggestions?
I assume you are in India and 1000 Rs. Is about $15. If that is correct, you probably should be sensitive to fees and do some comparison shopping with brokers or banks with storefronts in your area. If your future employer offers some kind of pension or profit sharing program, that might be worth investigating. Obviously India's tax system and rukes are different than the USA. That said, good for you in thinking ahead about your future financial well being.
You also may want to look at the BSE http://www.bseindia.com/ for information. Some of those "quick links" at the bottom of the home page may help.
With such small amounts you certainly need to keep an eye on transaction fees. See if any local banks or brokerages offer free transactions for some mutual funds... that would be a good starting point since it would easily allow you to invest your money on a monthly basis. So start there and see what your options are.
Thanks for the heads up on transaction fees. I thought I can pay monthly like we do in insurance. I will go to local banks and ask my employer if they have some sort of Employees Provident Fund. There is a discount broker called Zerodha and it takes Rs.20 for each transaction. I was looking to use their service.
Rather than a specific fund you might want to look at a diversified fund like Betterment.com. If you make a monthly payment there are no fees. They have a good, easy to use customer interface and app. That said, their performance hasn't been all that great recently.
Penny, do you realize that Zander suggested investing 1000 Rs. (about $15) and therefore is probably in India? That's why the earlier comments were generic.
Penny I appreciate your help, but as baudwalk said please read the thread and comments before posting.
If you'll be needing to take the money out of the investment in 10 years, you don't want to be TOO aggressive with the investment. You can look at the S&P 500 for much of the last 15 years and see what I mean. You might consider investing a good chunk of that money in debt instruments that mature at or before mid-2025.
