After entering the job market, the first thing you must do is start planning for your retirement. You can start investing to save for your retirement. One of the numerous investment options you can opt for is one of the different mutual fund types available in India. These variants invest in various assets and come with varying levels of risk. For choosing the suitable mutual fund variant and determining the asset allocation mix, use asset allocation calculators.
What are asset allocation calculators?
Asset Allocation Calculators are online tools that are easy to use. You can use them to get an appropriate asset allocation mix. All you need to do is enter your current age, investment horizon in years, and the level of risk you can tolerate (You can modify from very low to very high). For an answer, you will get the asset allocation mix that will help you acquire wealth over time. Mind that this calculator will help you determine how much you must invest in different mutual fund types, be it a debt or equity mutual fund.
How to use asset allocation calculators?
Let’s take an example. You are in your 20s and just recently joined the workforce. So, here are the steps involved in using an online asset allocation calculator:
- Enter your current age range
- Modify your risk tolerance (Select between very high to very low)
- Set your investment horizon in years
What are the advantages of asset allocation calculators?
Here are some of the advantages that are associated with asset allocation calculators:
- A suitable asset allocation mix:
Please remember that mutual fund investments should not be focused on one asset class. Instead, it is wiser to spread your investments in different asset classes. If your mutual fund portfolio leans heavily towards one asset class, you must opt for portfolio rebalancing. You could use an online asset allocation calculator to understand how much of your investment should be spread towards different asset classes.
- Easy to use:
Online calculators are simple to use. The process to derive either the estimated returns accumulated against the monthly investments, or the ideal asset allocation (for asset allocation calculators) is quick. With the help of these calculators, you can strategically formulate your investment plan for meeting your financial goals in the long term.
- Help you adapt:
Regardless of whether you are a fresh investor or experienced, online calculators can help you with investments. Market investing cannot and must not remain the same. It should change to adapt to different market conditions. Asset allocation calculators can help you determine how your investments should be made in accordance with your age, investment horizon, and risk appetite.
- No details required:
No extra details are required other than your age, investment tenure, and risk appetite. Do these things and you will get your answers.
- They are free:
It is easy to access these calculators thanks to the internet. Moreover, they are free to use, meaning you can use these calculators more than once, but you are not required to pay anything for the use.
An asset allocation calculator can help you change the course of your investments. The investment advice will help you accumulate wealth over time. Good luck with your investment journey.
To use asset allocation calculator visit https://mf.nipponindiaim.com/knowledge-center/tools/asset-allocation-calculator.