Everyone wants to invest in direct plans. And that’s the problem.
Don’t get me wrong.
The direct plan is the best thing to happen to an investor. You can now hire an investment manager, that is, invest in mutual funds directly without going through an intermediary or paying a commission.
You need not buy funds just because some bank or distributor wants to earn a commission. The commission is paid out by the fund house to the distributor in regular plans and you have to bear the cost of it.
It is believed that you as an investor, you are not ready to pay directly for service and advice and hence the cost is inbuilt into a regular plan via commissions.
I am sure you will deny that. “If I see value, I will pay.”
Now direct plans of mutual fund change the equation in your favour. You can now work with your advisor to discuss the service, scope and value you will get and fix a fee for the same. It doesn’t have to be forced on you as in the case of regular plans.
Now, several investors have realised that direct plans are great and they have set it out to do all by themselves. Call it Do it Yourself approach or DIY.
The question is can you actually do it by yourself or do you need an advisor?
If you are thorough about what you need and your investment plan, then you may not need an advisor.
However, that’s not true for most investors. In my personal experience, most investors find it difficult to control their urges.
They continue to repeat the same mistakes – investing in too many funds, investing in every variety, not understanding the core purpose of the fund and chasing returns. They do this thinking that they are doing the right thing.
How does investing Rs. 10,000 in 10 to 12 funds increase your chance of getting a higher return? If at all, it pushes you towards the average.
Yet, the game continues.
So, with this background, having access to an advisor who can support you and help you evaluate your decisions, becomes important.
Even if you were to make your own choice of investments, taking a second opinion helps you see loose ends, if any.
The advisor can help you get focussed which can then reflect in your portfolio too.
If as an investor, you feel you can benefit by having an advisor, then you can use something Unovest has to offer – the Premium subscription.
With Unovest Premium subscription,
- You get to have a view on your current portfolio.
- You can ask any specific questions around your mutual fund investments.
- You get access to our recommended equity portfolios.
- if you are an US/Canada NRI, you can get specific recommendations that are applicable to you.
- If you are a beginner, you can seek to learn by asking questions. of course, you should join the Investing 101 too.
- You can add multiple family members in a single login and invest in direct plans for all of them through this 1 account.
- Finally, you get priority support something that current users swear by.
All in all, you will be left enriched with knowledge and better prepared to handle your investments in the years to come.
As you can imagine, investing is not about a year or two. Typically, your investment decisions will impact 50 years or more of your life.
When you evaluate your cost, take that into perspective. A good foundation built now will easily hold a lofty structure.
See you on Unovest soon.