How can I invest my money at the age of 15?

                                             

The best thing for a minor to start with is Mutual Funds.

Mutual fund market is one of the biggest of its kind gathering gigantic sums of money from small investors.

Suppose you start a SIP from the age of 15(Finding the right scheme for you is essential). A well operated Mutual fund and an AMC having an intelligent fund manager would give you returns of 12–15%(on the safer side) which is double of what you get from bank accounts or FDs and an average of 20–30% on the higher side(on the higher side) with minimum risk.

There are two types of risk:

1. Systematic risk- Risk arising from rising Equity and share prices . It can be avoided by diversifying the portfolio.

2. Unsystematic risk - Risks arising from inflation and other types. This cannot be avoided.

By considering all these risks and the commissions of agents and fund manager and other staff salaries, Mutual funds still are able to provide a decent 20% returns which is more than enough for an average investor. Unlike stock markets, he doesn’t have to check the prices of shares from time to time as he doesn’t have any control over his investments.

So suppose you invest 1000rs each month in an SIP and you are 15 years old.

when you would be 50 years old, your total sum would be

= 1000*12*(50–15)

=4,20,000

If we consider the safest side i.e. 13% return every year, you will get

=4,20,000*0.13

= 54,600 on this lump sum amount

However this was of the lump sum investment however for an SIP you will get much more as your sum would get compounded and reinvested if you choose the growth option while selecting a mutual fund.

As they say : Compound Interest is the eighth wonder of the world.

BY ABHIRAM DAPKE