Safe? Yes. Smart? Well, maybe not.
You see, most people start investing through their banks because they trust the brand name and the personal relationship with their banker. What most of them don’t understand that is that their banker is acting as an agent, and selling higher priced regular mutual funds, that have high annual fees. In return for selling these funds, the bank gets a commission of 0.5-1.5% p.a. of your investment amount, that gets taken out of your money on a daily basis.
Instead, a smarter choice would be to visit a SEBI- Registered Investment Advisor, get an investment plan that is built using low cost direct mutual funds, which are the same as what you’d get at your bank, but with lower expenses. You can save 60-70% in fees, which means higher returns. This chart should explain the difference:
# Assuming Pre-expense growth rate of 15%p.a
* Assuming cost of saving 1.5%
