As far as investments are concerned, 2020 has been everything but predictable. Furthermore, the post-covid19 era has also revealed the inadequacies in our financial corpus, forcing us to move back to the drawing board for realigning investments.
Put simply, the nature of investments has undergone a considerable shift in 2020 with individuals more inclined towards a balanced corpus, rather than persisting with instantaneous gains. Not to mention the fact that even markets have dipped way below their potential, which has allowed us to speculate the nature of our funds and make decisions, with the future in mind.
In the subsequent sections, we shall talk about some of the most important investment-specific lessons that have come to the fore in the post-pandemic era:
- Prioritize Safety
Prudent investments should be the way to go in 2020 and even beyond. With the global financial machinery coming to a standstill post covid19, you must make it a point to prioritize safer investments in the next few years to come. This is where the likes of the FD account (know more about FD click here), post office MIS, and other relevant funds come into the mix.
- Make room for Penalty-Free Withdrawals
If you are planning to beef-up your financial corpus in the post-pandemic era, it is necessary to stay prepared for medical and other financial emergencies. Therefore, the likes of mutual funds, smaller SIPs, and other investment options with a minimum lock-in period need to be taken into consideration for liquidating funds, if and when necessary.
- Rely Less of Market-Linked Accounts
While you might still be tempted to invest in ELSS, ULIPs, SIPs, and mutual funds maintain discretion and keep a close eye on the market trends before moving ahead with the investments. Markets have been literally vandalized in the post-covid19 era which makes them a lucrative investment opportunity, only for the risk-takers.
Therefore, if you are looking towards decent appreciative growth while taking a bit of risk in the short run, market-linked funds can still be decent investment options. However, it is important to project restraint while opting for these financial escapades.
- Diversify Investments
2020 has taught us a lot about resource and asset allocation. Therefore, it is necessary to focus on investment diversification for making the most of your funds. A good approach is to focus on short-term FDs with decent fixed deposit interest rates, medium-term mutual funds and SIPs, and long-term investment policies like LIC, NPS, PPF, and more for striking the perfect balance between growth and sustainability.
- Opt for Unconventional Strategies
The new normal focuses on some of the more unconventional investment strategies with reliance on post office funds, govt. bonds, and gold bonds. Besides, even if you are planning to invest in an FD account, the focus should be on comparing and identifying options that offer high fixed deposit interest rates and flexibility to withdraw without hefty penalties.
Then again, each of the mentioned investment strategies shouldn’t be considered as a one-off attempt towards financial sustenance. Instead, these investment approaches should be prioritized for the next few years to come.