Investing can be intimidating for some of us. Check out these investment options that are easy to follow for all investors.

Do you know about these cost-effective investment options?

The world of investments can be tricky. The stock market is a dynamic place, and things are bound to get volatile from time to time. Profits and losses are a part of the investing game and cannot be ignored, no matter how safe you play. 

But as they say, you should never let the fear of failure get to you. If you are fearful of losing your money to a dip in the market or have had a bad experience with investments, here are some cost-effective, safe, and easy methods you can follow for your future investing endeavours. 

1. Direct stock purchase plans

A direct stock purchase plan or DSPP comes with a lower degree of risk as it can be bought directly from the source company. It completely eliminates the need for middlemen. In fact, you do not even need a brokerage account to invest in DPPs. However, since there are no brokers to offer advice, you may have to spend some time looking for the right purchase plan for your portfolio. 

You will first need to find the right companies that interest you. Once you have made your pick, you can visit the company’s website and purchase a direct stock from their investors’ page. Most companies offer such stock plans. You just have to pay a certain amount to open a stock plan account and select a monthly or yearly investment amount. 

DPPs eliminate the need for brokers. So you end up saving a lot of money that would have otherwise gone into paying broker fees and commissions. 

Related: Important things to consider when investing in a mutual fund

2. Exchange-traded funds

Exchange-traded funds or ETFs are mutual funds that function like stocks. They are gaining popularity by the day for being a better investment instrument than mutual funds. These funds represent a bunch of stocks and not just a single stock, say Nifty 50. 

Since they represent multiple stocks, ETFs benefit investors. This is because you won’t have to spend a lot of time picking different types of stocks for your portfolio. These funds offer great diversification and are cost-efficient. They can also be exchanged for liquid assets anytime. 

3. Investing apps or online brokers

It is the age of the internet, and the world of investing is catching up to it. Today, you have several investing apps that offer expert advice, online brokers, and easy accessibility. Online brokers can be availed of by those who are just starting their investing journey or have little knowledge of the topic. These online portals are always up to date with the happenings of the market and offer great advice on how you can diversify your portfolio using investment methods that best suit your short-term and long-term goals. 

Although these investing apps do charge some fees to set up an account, they are still quite affordable compared to traditional brokers. You also have the option to choose from varied plans based on your requirement, something that is still missing in their counterparts.

Related: 6 Books for women to learn the art of investing 

4. Dividend reinvestment plans

If you want to avoid the traditional broker, another route to try is dividend reinvestment plans. Just like direct stock plans, DRPs are also issued directly by companies, eliminating middlemen. These plans give investors the opportunity to reinvest their cash dividends back into the shares of the company. They also offer them a certain discount to buy these shares. 

DRPs are a great investment option since they do not require you to pay any commission. Moreover, investors get better returns when reinvesting their dividends in the same company’s shares, thanks to the power of compounding.

To sum up

Do not be scared to invest your money. It’s true that investing can be unpredictable, and the risk quotient is generally higher than with traditional saving methods. But the returns are greater too. The ultimate goal for any investor is to see their money grow, and this can be achieved with the right investment strategy. 

If you are intimidated by the world of investing, try out the methods listed above. With time, as you gain more confidence in your approach, you can also explore other types of investments.

Disclaimer: This article is intended for general information purposes only and should not be construed as investment or tax or legal advice. You should separately obtain independent advice when making decisions in these areas.


How I did it

Praveen Nair

Ever since I retired, I have looked forward to the festive season with added zeal. It is the buzz that I need once in a year in my laidback post-retirement life. I like to celebrate the occasion, get the house painted or renovated, buy gifts for my dear ones or go on a vacation. These things… Read more

Swati Mehra

A couple of years ago I was over the moon after landing my first job. I celebrated regally during the festive season that ensued, only to land in a financial soup for the next few months. With gargantuan credit card bills and barely any cash left, I had no other option but to default the payment… Read more

Rohansh Pathak

It is highly unlikely that all the expenses made during the festive season were worth making in the first place. This is the time of the year when unavoidable expenses are bound to upset your budget plans, and you can do little about it. However, I have made it a point to have a look at the… Read more

Shubhra Banerjee

I am a single mother of one. I lost my husband just 5 years into my marriage. Life has been a struggle for me, but I have managed it and today I have no complaints. 

I was a young widow with a 3 year old son when my husband passed away due to a heart attack. My parents were my rock… Read more