Learn about the basics of investments, understand the jargons, primary concepts and prepare yourself for a successful investment journey.

In finance, an investment is the purchase of an asset today with the hope that it will provide regular income or appreciate in value in the future. Every individual divides his/her income in two broad parts:

1. Buying goods and/or services needed for current consumption
2. Saving some funds for a planned / unplanned expenditure in the future

These saved funds usually lie idle either in a bank account or as cash at home. Also, many people who live from paycheck-to-paycheck find it difficult to save funds from their current incomes. Nevertheless, they want to be prepared for future expenses too! In both the scenarios, the desire to see the money grow over time and help manage costs later in life is deep rooted. This is where investment steps in.

People who either save or cut costs to ensure a better future, look to part with their funds temporarily by ‘investing’ them in options that offer returns on their investments.

Before you get into looking at the investment options available, it is important to assess and lay down your ‘Investment Objective’ This sounds rudimentary but avoiding this can lead to investing without focus and eventual financial loss!

1. Do you desire appreciation of your capital?
2. Or, are you looking for regular income?
3. How willing are you to take risks?

The answer to these questions will help you determine an underlying theme behind all your future investments. We help you determine your investment objective. They are as below:

1. Minimum risk: All investments have an element of risk associated with them. And, risk is directly proportional to returns; higher the risk & higher the return. There are many investors who are unwilling to take risks on their invested capital and are willing to compromise on the returns. 
2. Capital appreciation: On the other end of the spectrum are investors who are willing to take risks and desire a growth in their desired capital. These investors realize that a downward trend of the market can lead to a potential financial loss but take the risk to stand a chance to achieve good returns. 
3. Regular income: With the ever increasing cost of living, many investors desire their capital to provide a secondary source of income. They invest in options that offer periodic returns.
4. Reduce / eliminate tax liability: There are some investors who invest solely with the purpose of saving tax. They look for options that offer tax exemptions and/or rebates. 

These are some commonly defined investment objectives. Every investor has a specific objective which needs to be identified. Once the investment objective is defined, then you start looking at investment options that match your financial goals. Some such options are: SAVINGS ACCOUNTS | BANK FIXED DEPOSITS | POST OFFICE SMALL SAVINGS SCHEMES | PUBLIC PROVIDENT FUND | DEBENTURES | BONDS | COMPANY DEPOSITS | MUTUAL FUNDS | LIFE INSURANCE POLICIES | EQUITY | REAL ESTATE | GOLD AND MANY MORE.

Investment is a journey and not a destination. Prepare well before you set foot on this journey and improve your chances of earning good returns.