What is Investing? A Simple Guide for Beginners
By WealthCare Vest | Raghav Goel
📅 Published on June 15, 2025
When most people hear the word investing, they often think of the stock market, mutual funds, or fixed deposits. But the truth is, investing is not limited to just these financial products.
Let’s break it down simply — because understanding investing is the first step to building real financial freedom.
✅ What is Investing?
Investing means putting your money to work so that it grows over time. It is not only about putting money in mutual funds, FDs, or real estate — any money you set aside today that gives you a return tomorrow is an investment.
For example:
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Saving ₹1000 in a Fixed Deposit that earns 6% annually ✔️
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Putting ₹10,000 in a Mutual Fund SIP that grows at 12% annually ✔️
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Lending ₹5000 to a friend who returns ₹5500 after a year ✔️
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Even storing ₹500 in a piggy bank (though it gives 0% return) — is a form of saving, not investing ❌
💡 So, How is Investing Different from Saving?
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Saving = Parking money with little or no return (Example: Saving in a jar)
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Investing = Putting money where it can grow over time (Example: SIP in a mutual fund)
“Saving protects your money. Investing grows your money.”
🔍 What Return Can You Expect from Investments?
Return depends on the product and your risk profile. Here's a simple table:
| Investment Option | Risk Level | Average Return |
|---|---|---|
| Fixed Deposit (FD) | Low | 5–7% p.a. |
| Public Provident Fund (PPF) | Low | 7–8% p.a. |
| Mutual Funds (SIP) | Medium | 10–14% p.a. |
| Stocks (Direct Equity) | High | 12–18% p.a. |
| P2P Lending | High | 12–16% p.a. |
🧠 Want to learn the difference between Mutual Fund Direct vs Regular Plan? Read here
🎯 Why Choosing the Right Investment Product Matters?
Every person is different. Some like safety, others like high returns. That’s why your investment must match your goals and your risk profile.
For example:
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Ramesh, a 25-year-old, can invest in mutual funds or stocks for long-term growth.
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Sunita, a retired woman, may prefer FDs or PPF for capital safety.
That’s why, before investing, it’s best to consult a financial advisor who understands your goals, income, and risk appetite.
🧭 How Can an Investment Advisor Help?
An advisor can help you:
✅ Understand your financial goals
✅ Analyse your risk profile
✅ Recommend the right investment products
✅ Track your portfolio over time
✅ Help you plan for retirement, education, etc.
🔁 Related Blogs You Should Read:
🧾 Final Thoughts
Investing isn’t complicated. It’s just about starting early, being consistent, and choosing the right options based on your needs.
You don’t have to be rich to start investing. You just have to be disciplined and informed.
Still confused where to start?
📲 Reach out to me on LinkedIn or explore our services at WealthCare Vest
📌 Disclaimer
This blog is for educational purposes only. Investing involves risks, including loss of capital. Readers are advised to consult a certified financial advisor before making any financial decisions.
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