Here’s How You Can Invest in Mutual Funds Online

Posted in Mutual Fund Blogs By Chanel Rick - February 02, 2022
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With the release of the Union Budget 2022 earlier this week, many people are gearing up to start planning the next phase of their financial goals. If you haven’t already, then maybe now is a good time to start considering investing in Mutual Funds. And, the best part? With the advancement of technology, all your investment needs can now be met online.

Now, in the good old days, one could only buy and sell Mutual Funds through brokers and financial planners. However, it’s time to advance with the changing times and reap the benefits of buying Mutual Funds. Before you begin on your new financial journey, you need to identify where can you find them online, what kind of Mutual Fund are you interested in, and what kind of charges should you be anticipating.

So, where do you find Mutual Funds online? 

Fortunately, most well-reputable and popular banks and financial institutes offer the convenience of investing online on their platforms. Each of them offers a variety of Mutual Funds for you to pick, based on your needs.

Here are a few types for you to know!

  1. Debt Funds such funds provide you with a steady, but low-income relative to your equity. This makes it ideal for those who don’t want to invest in an explosive equity market.
  2. Tax Saving Funds – these funds are eligible for tax benefits under section 80C of the Indian Income Tax Act. It’s the perfect option for taxpayers who would like some tax relief.
  3. Equity Schemes – great for long-term wealth creation, this type of Mutual fund invests its assets in the stocks of different companies, depending on the investment objective of the scheme.
  4. Close-Ended Scheme- long-term investors can prevent early redemption or protect the interest with the benefit of the lock-in period.

Once you decide on the kind of Mutual Fund you would like to purchase, it’s time to understand the underlying costs of it. However, bear in mind that these costs will vary across different financial institutions. Here are a few expenses you may incur while investing in Mutual Funds.

Net Asset Value (NAV)

The NAV is essentially the company’s total assets without its total liabilities. After every business day, the AMC will calculate the fund value depending on the NAV.

Administration Fees 

However, the AMCs will charge you with an administration fee, which will cover areas like advertising and brokerage, among other administrative charges. This will be measured using an expense ratio, which means that lower ratios translate to a lower cost of investing in that Mutual Fund.

Sales Charges 

You may be charged some sales charges, which had been borne by the company as a form of distribution costs.

With all these different areas covered, here’s an overview of what the online process will look like.

  1. Registration – At this point, you will have to provide the website with some of your details like name, date of birth, mobile number, and email address. You may be asked to provide your PAN card number as well, followed by KYC compliance.
  2. Additional Personal Details – here, you will have to fill in the online form or application with information regarding your nationality, profession and income.
  3. Nominee Details – this is a voluntary step, you can provide the basic details of your nominee.
  4. Banking Details – you will be required to fill in details like IFSC code, type of account, and account number, among other details.
  5. Select Investment Plan – at this point, you will have to select an investment plan, followed by filling in the tenure and amount you would like to invest.
  6. Payment – lastly, you can go ahead and make the payment and tick the box for any other terms and conditions mentioned.

That’s all it takes to begin investing in Mutual Funds. So, why wait? Start investing today!

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