DIY is fancy word popping up on YouTube and Instagram lately. DIY craft, DIY Makeup, DIY home décor, DIY furniture. These have become trendy and has become a revolutionary concept. Everything has become DIY where there is no need for an intermediary or a professional to help you do your work. Now especially with so much content available on internet and YouTube, financial planning can sometimes seem like it is not a big deal. Good if you can understand everything you read and implement perfectly but more often than not there are good chances that you might fall off track mid-way. So here are few mistakes that you can avoid if you are investing on your own.

1. Think before you act: This can be seen commonly in forums and in the comments section of blogs “I have invested in ABC fund. Is it a good scheme”? If you have also done that then there is more than one thing wrong about this. Firstly, if someone gives you a negative reply, it will only take you on a guilt trip and nothing else, what’s done is done and you need to only focus on how to correct it. Secondly, the place for follow up is definitely not the internet, you will end up extremely perplexed because of difference in opinion, lose confidence and shut your laptop with a sad face.

2. Best schemes don’t make the best portfolios: You have access to all real time data and you can easily get detailed information about the top performing schemes, best schemes to choose from based on previous performance and every possible filter. Choose the top 5 funds with highest returns and you are goodto go! That’s what you might have thought if you have discovered any website providing the funds data. Ok so what’s wrong with this? Simple, not every fund will fit your risk profile and definitely not your goals. Every goal can be satisfied with a fund but every fund cannot satisfy a goal.

3. You might be paying too much!: With a ton of platforms advertising to invest through them, you can be tempted to go with big names but there might be some things hidden. That’s right “Charges, commissions, fees and a whole lot of other expenses” that might be weighing your returns down.

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4. Planning to fail: Any investment you make without a right plan of action or without considering your goals and risk profile simply means that you are riding straight into a pothole. It will be a real bumpy ride if you don’t have a solid plan and jump into action. It is advised 10 out of 10 times to always do goal based planning, blind investments can create cash crunch, it can make your goals off track and even make your debt ridden.

5. Panic attack when market drops: It is absolutely common for markets to drop, but a novice investor tends to freak out, pull the panic chord and immediately get out of the fund even if he is in loss and has charges attached to it. This is when emotions have to be thrown away and focus has to be on the big picture. Choose and stick to the pre-determined plan.

6. Tax consequences: There are always ways to avoid taxes and a professional might be the only one to advice in the tax saving investments. Research on internet might help but it might not be as reliable as you would want it to be. In case you have great earnings and happy about it, the downside is the gains might be taxable and this will give a hit to your earnings. Even small differences will turn out to be massive on along run.

7. Ignoring to keep aside fun money: Starting something new might seem very exciting, especially when you are motivated and believe that investing will help you earn. In this cloud of excitement, it is common to invest every last rupee you find without having any liquid funds. You totally forgot to keep aside money for your weekends, gifts you might have to give, food, clothing and all your other monthly expenses. This might end up being bad than you think, it will drain your money faster and leave you with no option but to borrow or take loans or staying due on your credit card bills.

Mistakes are a part of investing process. But what is important is knowing what they are and how to avoid them will help you succeed. To sum up how to avoid mistakes above, develop a well thought, systematic plan considering all variables and stick with it. It you want to do some experimenting, make sure you have some money set aside for it which you are fully prepared to lose. If you are not sure about DIY investing, make sure you seek help from a professional, it will help you in many ways than you can think of.