Mutual Fund Investment Plans For Beginners?

Mutual Fund Investment Plans: A complete guide for beginner investors

Introduction: What is a Mutual Fund?

A mutual fund is a financial instrument in which multiple investors’ money is levied in shares, bonds, or other investment options. It is managed by a professional fund manager, who attempts to ensure better returns for investors.

How does a mutual fund work?

Money Collection: A small amount is taken from investors.
Property Management: Fund managers put it in diverse properties.
Distribution of profit: profit or loss on investment is divided among all investors.

Main advantages

Diversification: Risk is reduced by distributing investment to different sectors.
Professional Management: Your money is managed by experts.
Starting with a small amount: ₹500 can be invested even per month.
Liquidity: Investments can be cashed when needed.

How do I start investing in a mutual fund?

1. Decide your investment purpose

Short term: If your plan is for 1-3 years, choose a date or liquid fund.
Medium term: Hybrid funds are suitable for 3-5 years.
Long-term: Equity funds are better options for 5 years or more.

2. Assess risk-tolerance ability

Choose a fund based on your risk-tolerance ability. If you can take more risks, invest in an equity fund. Date funds are ideal for those who like low risk.

3. Complete the KYC process

KYC (Know Your Customer) process is mandatory to start investing in a mutual fund in India.

Document: PAN card, Aadhaar card.
Process: Complete KYC online or offline.

4. Select the right fund

See the fund’s performance and its track record.
Pay attention to the expertise of the expense ratio and fund manager.

Why choose a mutual fund?

adaptable for small investors.
Diversification decreases risk.
professional management and transparency.

Types of mutual funds

1. Equity Mutual Fund

investment in the stock market.
High risk, but long-term benefits.
Example: large-cap, Mid-cap, Small-cap fund.

2. Date Mutual Fund

Investment in government and corporate bonds.
suitable for stable return.
Example: short-term and long-term date funds.

3. Hybrid Mutual Fund

mixture of equity and date.
medium risk and returns.
Example: Balanced Advantage Fund.

4. Liquid Fund

for short-term investment.
useful as an emergency fund.

5. Tax-Saving Fund (ELSS)

benefit of income tax exemption.
3 year lock-in period.

6. Index Fund

Track the stock index.
low-cost funds.

Benefits of investment in mutual fund

1. Professional management

Fund managers handle your investment with expertise.

2. Diversification of risk

Risk is reduced from investment in different sectors.

3. Transparency

All information related to investment and returns is given regularly.

4. Liquidity

Mutual fund investments can be cashed at any time.

5. Tax Benefits

Income tax exemption is available on investing in funds like ELSS.

6. Favorable to start

Investment can be started with a lower amount, like ₹500 per month.

Mutual fund plans for beginners

1. SIP (Systematic Investment Plan)

regular and small investment option.
Advantages of compounding in the long term.
helps maintain discipline.

2. Target-based investment

Short-term Goals: Liquid or Ultra-short-term Fund.
Medium-term goals: balanced or hybrid fund.
Long-term Goals: Equity Fund.

3. Funds suitable for initial investors

Large-Cap Equity Fund.
Balanced Advantage Fund.
Date and liquid fund.

Process of choosing a Mutual Fund

1. Decide your investment purpose

Clarify the time and target of investment.
Assess the risk-tolerance ability.

2. See the fund’s performance

Check the performance of the last 5–10 years.
Keep in mind the fund manager’s experience.

3. Analysis the cost

Understand the expense ratio and entry/exit load.

4. Select the category of fund

Choose according to your need from equity, date, or hybrid funds.

Mutual Fund investment process

1. Complete the KYC process

Do E-KYC through Aadhaar and PAN card.
Online process via AMCs or broker platforms.

2. Online and offline investment options

Online options: Groww, Zerodha Coin, ET Money.
Offline Options: Through banks or distributors.

3. SIP and lump sum investment

SIP: Regular small investment.
Lumpsum: investment of a large amount at once.

Common mistakes during mutual fund investment

1. Investing without research
Always check the fund’s performance and details.
2. Making emotional decisions
You shouldn’t be afraid of a fall in the market.
3. Do not review portfolio
Regular reviews and balance of your investment.
4. Expect more returns
Keep a real and practical viewpoint.

Top platforms for mutual fund

1. Groww

User-friendly and simple interfaces.

2. Zerodha Coin

Direct Mutual Fund with zero commission.

3. ET Money

Easy way of investment and tracking.

4. Paytm Money

Better choice of investing through mobile.

Conclusion

Mutual Fund is an easy and effective way for investors starting out. With selecting the right fund, regular investment, and discipline, you can easily achieve your financial goals. Early investors are advised to start with low-risk funds and expand their portfolio by understanding the market.

Best Mutual Funds for Beginners in 2025?

Best Mutual Fund for Initial Investors in 2025: A Complete Guide

Mutual Fund is a popular and effective option for investors, especially for those who do not understand the complex aspects of the market. In 2025, the Indian Mutual Fund Market has touched new heights, and it has become more important for beginners to choose the right fund.

In this article, we will list the best mutual funds for beginners investors in 2025, plus how to invest in these funds.

Why Invest in Mutual Funds?

1. Start with small amount

You can start with an SIP of ₹500 per month.

2. Professional management

Fund managers manage your investment with expertise.

3. How to reduce risk

Mutual funds provide diverse investments, which helps to reduce risk.

4. Liquidity and transparency

Mutual Funds can be sold or bought at any time.

Tips for choosing a mutual fund for beginners

1. Understand the purpose Set your investment objective, such as creating a long-term asset, children’s education, or retirement planning1. Understand the purpose Set your investment objective, such as creating a long-term asset, children’s education, or retirement planning

2. Risk tolerance ability If you can endure a high risk, choose equity fund. Hybrid fund for medium risk. date fund for a low risk.

3. See the fund’s performance Assess performance of the last 5-10 years, the expertise of the fund manager and reputation of the fund house.

4. Pay attention to the expense ratio and Returns Funds with low express ratio give more returns over the long term.

List of Best Mutual Funds for Initial Investors in 2025

1. Large-Cap Equity Funds

Large-cap Funds provide stable and secure returns as they invest in top companies in India.

HDFC Top 100 Fund

Previous 5 years return: 12% to 15%.
Risk: medium to medium.

SBI Bluechip Fund:

consistently good-performing fund.
suitable for new investors.

2. Hybrid Funds

combination of equity and date. This is ideal for medium-risk investors.

ICICI Prudential Balanced Advantage Fund:

automatic portfolio balance to reduce risk.

HDFC Hybrid Equity Fund

The correct balance of equity and date.

3. Mid-cap and Small-cap funds

for high risk and high returns. Suitable for long-term investors.

Axis Midcap Fund:

good growth rate and stable performance.

Nippon India Small Cap Fund

Investments in small companies, which can give big profits in the future.

4. Tax Saving Funds (ELSS)

To save income tax and increase property.

Mirae Asset Tax Saver Fund

Better returns with a lock-in period of 3 years.

Canara Robeco Equity Tax Saver Fund

low express ratio and stable performance.

5. Index Funds

Stock market index track. Suitable for low cost and long-term returns.

UTI Nifty 50 Index Fund

Low expense ratio and performance associated with the market.

SBI Nifty Next 50 Index Fund

Investment in the next level of large-cap stocks.

6. Date Funds

For low risk and stable returns.

HDFC Short-Term Debt Fund

ideal for short-term investment.

ICICI Prudential Corporate Bond Fund

Safe option for investment in corporate bonds.

7. Liquid Funds

For emergency funds.

Axis Liquid Fund

for short-term parking.

Kotak Liquid Fund

high liquidity and low risk.

General mistakes and measures to rescue during investment

1. Investing without research

Always check the fund’s performance and the fund manager’s records.

2. Try to make profits quickly

Invest long-term patiently in mutual funds.

3. Put all money into the same fund

Let your investment diversify.

4. Slow in market emotions

Don’t be afraid of falling in the market.

Frequently asked questions about a mutual fund (FAQs)

1. Are mutual funds safe?
Mutual Funds are at risk, but with the right fund and plan, investments can be safe.

2. What is the minimum investment amount?
₹500 per month for SIP and ₹1,000 for Lumpsum.

3. Do Tax Benefits in Mutual Funds?
Yes, investment in ELSS Funds gets a discount of up to ₹1,50,000 under Section 80C.

4. How many times should the portfolio be reviewed?
once every 6 months.

5. Can money be withdrawn immediately from mutual funds?
Yes, money from open-ended Funds can be withdrawn immediately.