In today’s fast-paced world, making sound financial decisions is more critical than ever. It’s essential to make smart investment choices so that you can build wealth, plan for your future, and achieve your financial goals. One of the most effective ways to achieve this is by using a lumpsum calculator.
A lump sum calculator is a tool that can help you make informed investment decisions. It helps you calculate how much you’d need to invest today to achieve a specific financial goal in the future. A lumpsum calculator takes into account factors like the expected rate of return, investment tenure, and even inflation. By using a lumpsum calculator, investors can make informed decisions about their investments.
Here, we look at how a lumpsum calculator can help supercharge your finances.
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NFO Mutual Funds
An excellent option for investing through a lumpsum calculator is New Fund Offer (NFO) Mutual Funds. An NFO mutual fund is a freshly created mutual fund that investors can subscribe to before it is launched. The primary difference between an NFO mutual fund and an existing mutual fund is that an NFO mutual fund is launched for the first time.
NFO mutual funds can create a lot of buzz and excitement among investors as they offer a unique opportunity for investors to be a part of the fund since its inception. Typically, NFO mutual funds are launched on a limited basis, and investors can subscribe to them via the investment platform for a specific time frame.
How to use a Lumpsum calculator for investing in NFO Mutual Funds?
NFO mutual funds are great fodder for those wanting to invest in a fund from inception. Lumpsum calculators make it easier for interested investors to calculate the money they need to invest in these funds.
Let’s take an example to explain this further. Suppose you want to invest in an NFO mutual fund that is expected to yield a return of 12% per annum for six years, with a goal of accumulating INR 2,00,000 after six years. In this case, you can use a lumpsum calculator to calculate the initial investment required to achieve your financial goal.
Given the aforementioned details, the lumpsum calculator would determine that the initial investment required is INR 1,00,000. This means that you can invest INR 1,00,000 in the NFO mutual fund at the start and leave it there for six years, allowing it to grow at an anticipated 12% per year, which would yield a total corpus of INR 19,97,382 at the end of the six-year tenure.
It’s important to remember that these returns are just projections, and they’re subject to market risk and volatility. It’s also crucial to understand the investment plan’s goals, track record, management fees, and after-tax returns before investing.
Investors can also use lumpsum calculators to compare investment plans and pick the one that best suits their financial goals and risk appetite.
Conclusion
Using a lumpsum calculator can help investors make informed decisions about their investments. It’s a great tool to assess the initial investment for any financial goal accurately. NFO mutual funds, with their unique benefits, can be an excellent option for investors, especially those who want to leverage the benefits of investing in a fund from its inception.
Though investing in NFO mutual funds through a lumpsum calculator can help investors achieve their financial goals in the long run, it’s crucial to remember that investments always involve some amount of risk. They should be made with the requisite amount of caution, and one should consider the pros and cons before investing.
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Disclaimer
Investing in the Indian financial market is subject to market risks. The information provided here is only for informational purposes. It does not constitute an offer or solicitation of an offer to buy or sell any securities or financial instruments. All investors are advised to conduct their research and make independent decisions. We shall not be responsible, directly or indirectly, for any losses incurred or profits made in investments made based on the information provided above.
Summary
Lumpsum calculators can help investors make informed decisions about their investments, especially when investing in NFO mutual funds. These calculators assess the amount of initial investment needed to reach specific financial goals and take into account several factors such as expected rate of return, investment tenure and inflation. Though investing in such mutual funds is subject to market risks, using lumpsum calculators can help mitigate the financial risk. Investors must remain cautious and aware of the pros and cons of trading in the Indian financial market.