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In this video, Abhi and Niyu explain how compounding can make you RICH! Personal finance is a topic that most of us keep delaying in our life. But once we understand the cost of time in the world of finance we realize, the earlier we start the better returns we get in the long run.
Tools:
SIP Calculator
https://www.mutualfundssahihai.com/en/calculators
Comparison between 1 crore and 1 rupee:
https://1drv.ms/x/s!Aq6IzrkRYe380k14Iq9gPWsgSzY5?e=OUrtsW
00:00 Intro
00:46 What will you choose?
01:26 What is compounding?
02:10 What do we learn from compounding?
02:54 Invest in Direct mutual funds using Groww
03:47 Invest 500 and become a crorepati
05:28 Conclusion
05:56 Did you like the video?
A video by Abhiraj Rajadhyaksha & Niyati Mavinkurve
What is compounding?
Compounding is the process in which an asset’s earnings, from either capital gains or interest, are reinvested to generate additional earnings over time. This growth, calculated using exponential functions, occurs because the investment will generate earnings from both its initial principal and the accumulated earnings from preceding periods. Compounding, therefore, differs from linear growth, where only the principal earns interest each period.
https://www.investopedia.com/terms/c/compounding.asp
What are direct mutual funds?
Direct funds are those mutual fund schemes that are directly offered by the fund house or AMC. The names of these funds are prefixed by the word ‘direct’. There is no involvement of a third party, distributor, or agent. The investors directly deal with the AMC offering the fund. Since there is no involvement of a third party, there are no commissions or brokerage charges involved in these transactions. Hence, the expense ratio of direct plans is comparatively lower than that of regular funds.
Features of direct funds?
The following are the salient features of direct funds:
Investors don’t depend on a third party to make investments.
You can invest in direct funds, both online and offline.
As there is no commission to be paid, the fund house will not impose the distributor fee and hence, keeping the expense ratio on the lower side.
Transaction charges are not levied.
The word ‘direct’ denotes the direct funds.
https://cleartax.in/s/direct-funds#:~:text=Direct%20funds%20are%20those%20mutual,party%2C%20distributor%2C%20or%20agent.&text=Hence%2C%20the%20expense%20ratio%20of,than%20that%20of%20regular%20funds.
What are index funds?
As the name suggests, an Index Mutual Fund invests in stocks that imitate a stock market index like the NSE Nifty, BSE Sensex, etc. These are passively managed funds which means that the fund manager invests in the same securities as present in the underlying index in the same proportion and doesn’t change the portfolio composition. These funds endeavor to offer returns comparable to the index that they track.
https://groww.in/p/index-funds/
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About Us:
Abhi and Niyu is the fastest growing Indian educational YouTube channel. Abhi and Niyu are a husband-wife couple who believe in the power of our youth.
Abhi and Niyu started their page to talk about positive, impactful ideas and to inspire offline action from online content. It was a way to change the way our negative feeds operated and replace negative news with positive, action-oriented news that made some change. They decode and simplify issues for Millenials and believe small steps lead to big outcomes in the future. Their videos span different genres like history, environment, and sustainability, policy discussions, social commentary, economics, personal finance, among others.
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