- Date : 16/09/2022
- Read: 3 mins
6 nudges to invest better!
Investing is an art as well as a science. We are all aware of the steps that we need to take to become better investors. But still, somehow we miss the bus. Often, we make the wrong choices. All of us need some small encouragement or nudges to make the right decisions when investing our money. Here we list 6 valuable tips that can help you to become a better investor.
6 nudges to become a better investor
Here are the 6 tips you need to follow to become a better investor:-
- Incentivize- You should incentivize the right financial decisions to make sure that you pursue those decisions. You know the correct decisions, but you need to incentivize those decisions when you take those. For example, if you start a SIP of Rs 15,000 per month, you should incentivize that by taking the much-awaited trip to reward yourself for the correct decision.
- Mapping- You need to map investment concepts to real-life scenarios. If you map the concepts well, you know what steps to take. For example, we all know that long-term and consistent investing is better; you should map your retirement corpus by using CAGR calculators and map your current investments to long-term return potential of that amount.
- Default option- Investing should be the default option, and you should not need to make a decision. For example, when your salary comes, you should start a SIP so that it gets deducted every month, and that is the default option. You need to take a step to stop that SIP.
- Feedback- Consistent benchmarking and performance feedback are a nice way to check that you are making the right decisions. If you make the right decisions, your feedback will help you to garner the right direction.
- Reducing or stopping errors- We all make mistakes, but identification and rectification is a nudge you need to take to ensure that you do not lose much because of the mistake.
- Reducing the complexity- Investing process appears complex, but if you break down the process, it is not that difficult.
What should be done?
You need to make sure that you follow these nudges, and you should remember that consistency is more important than identifying the best stock/mutual fund. If you make your process consistent, you are bound to achieve success in your investment career. Even if you make mistakes, constant rectification of the mistakes with periodic feedback will ensure that you get back to the successful path.
Related: Different types of IPO investors