I am 29 years married and residing in Hubli. I want to invest in equity mutual funds, but I am new to investing. I have decided to opt for direct plan of mutual funds rather than the regular plan, as I heard they are cheaper because there are no broker commissions. Is this a wise move? Is my money safe?
Direct plans of mutual funds have a lower expense ratio compared to the regular plan.This is because you invest directly with the mutual fund house and don’t require the services of a mutual fund distributor, saving on commissions paid to him. This saving helps you get good returns over the long term. But, you are a new investor and you may need a financial adviser to help you make the right investment choice. Go for a direct plan only if, You have a basic idea of investing. You understand financial products and how to sift good ones from the bad. You have the discipline to stay invested in adverse times. If you can do this, invest in direct plans of mutual funds and save on advisory commissions. But, you are new to investing and might need the help of a financial adviser to guide you with mutual fund investments.