What is investing
Investing means an act of devoting time, effort, money or energy to a particular undertaking or work with the expectation of getting a worthwhile result. we will be talking about investing more in the monetary sense here. And expect to bring some worthwhile results which will also be In monetary terms.
1/- Money value is going down with time
Indian being a developing country has inflation in its nature..you can understand it better by checking out the last 10-20 years figures. Here is a chart showing the dollar price in terms of rupees.
2018 1 dollar = 65 rupee
2019 - 1 dollar = 71.65 rupee
It means that in one year the rupee has been depreciated approximately by 10%.
Now You need more rupees to buy one dollar, one litter of milk, one piece of bread. If you are having money in your home and it is not getting utilized for any purpose it seems to be constant but it is decreasing. Now some people will say they are having their money in bank account whether it is saving account or current account. Now understand this that in saving account you are earning interest but still it is less than 10% most of your banks give you 4% interest. Means those who have kept their money in the saving account @4% p.a., their money is getting depreciated @6% p.a., solid loss of 6% p.a. Those who have taken fixed deposits @7% p.a., they have to pay the taxes too, means solid loss of 3-4%. If your money is not getting an increase of 10% p.a., it means it is getting depreciated. No one knows about the expenses you have cut for your savings, but the expenses are not really over, they are continuing now also.
2/- reduces unnecessary expenses
most of the time it happens that we save money for a while and wherever we come across some small desire and need we spend that money for self-satisfaction. just like kids use a piggy bank to save there money. in the same way, adults can use their investment as a piggy bank to save their money in it. we use to think twice before breaking our piggy bank, don't we? so it will help you to postpone your unnecessary expenses now and meeting your financial goal in the future.
3 /- a second source of income
at first, you don't have that much saving it works like a piggy bank but later on when you accumulate a certain amount. a well thought out investing can give you a considerable return on your money and can be a backup or a secondary source of income, which might help you in the future.
4/- provides security to your money
when you invest through a reliable channel. you need not bother about the security of your money. someone can stone money from your pocket but it won't be that easy for him to steal it from your bank account. because these channels which provide you investment facilities have a business in money and they spend a considerable amount to keep their affair secure.
5/- gives you knowledge and vision.
when you invest in equity (shares) of a company. you take interest in that companies affairs and industry in which such a company is working. it provokes you to think in a much broader way. which open will open your mind and give you vision.
6/- perfect utilization of your spare time
investing is fun on its own. using social media.. watching videos and all which doesn't make any sense might be a waste of time. but playing in the financial world would be fun and beneficiary at the same time.
7/- helps in achieving long term financial goals
as said above it will not just reduce your present unnecessary expenses and setting aside a small amount may be accumulated as a fund to fulfill your long term financial goals.