Do mutual fund terms still confuse you? Let’s help. This article explains some common mutual fund terms in simple English.
Mutual Funds ?
Let’s start from the beginning, right? A mutual fund is similar to gathering funds to buy a box of pizza from a chef. Mutual funds pool money from various small investors to make massive investments at once.
The Fund Manager ???
The fund manager is like the chef who you trust with your money to make a great pizza. After pooling the money together, he goes around to source the right materials to make a great pizza. In essence, the fund manager is the professional who oversees the money invested in a mutual fund; to make sure it earns more money.
The Trustee ??⚖️
To ensure the chef does things right, you need someone to monitor that he delivers the exact pizza he promised. So, a supervisor steps in. That’s exactly what the trustee does. Trustees ensure that fund managers invest your money rightly and earn you correct returns.
The Registrar ???
Now, what if the pizza gets ready and the chef claims you didn’t pay him? Well, that will be impossible if you had a legitimate receipt right? A registrar, in the case of a mutual fund, provides you with that receipt.
Mutual Fund Types ???
Just as you have various pizza types, you have mutual fund types. The common ones are equity funds, fixed-income funds, and balanced funds. Equity funds invest your money in shares of high-flying companies that are carefully selected. While fixed-income funds invest in low-risk investments that are backed by a promise - government debt for instance; in which the government borrows x and agrees to pay back with a certain percentage. Finally, balanced funds. As the name suggests, they mix the earlier options.
Risk Assessment ??♀️
Moving on, every good chef should understand how much spice you can handle before making your pizza, right? So, they ask and craft something in line with that. We at Cowrywise are good chefs also. Before you invest in any fund, we take you through a spice test (risk assessment). Based on the results, we suggest the best-fit funds for you. Equity mutual funds are very spicy, that is they are for high-risk investors. On the other hand, fixed-income funds are a little bit spicy, while balanced funds are moderately spicy.
You can take a simple risk assessment and Get started.
To better explain these mutual fund terms, we made this video for you.
How can i live frugally with a roommate that spend lavishly
Except for expenses that are sometimes shared (like electricity bills and other utilities), I’d recommend that you keep your expenses as separate as possible. That way, your roommate’s lavish lifestyle does not exactly affect you – except the peer pressure part. In that case, you’d need discipline.
This article was a bit helpful though, at least I read some stories similar to my experience. I’m a 400lvl medical student of unn trying to save money for things I know my parents won’t get for me, But here is the thing, we’re comfortable to an extent financially but I don’t get monthly allowances. They just send me money when ever they feel like could be once in 2 months (usually 40k for 2 months)or once in a month or they just give me cash when I’m going back to school. The bottom line is, considering the state of this country these allowances are barely enough for me to be able to save. And I don’t even eat out anymore. I try to cook or maybe just starve (lol) but either way. I just want to know if there is anyone in this same situation and how you went about it or anyone that could help Map out a plan on how to go about saving plus any suggestions on a job I could take on as a medical student considering how stressful and demanding my course is.
T for Thanks ?