The promise of high returns can be incredibly tempting, but it's essential to stay grounded in sound investment principles. Making rational, well-informed decisions — rather than emotionally driven ones — is key to protecting your hard-earned money.
Understanding the investment product, as well as the background of the financial institution offering it, is absolutely critical. Even with years of experience in banking and a history of giving financial advice, many fell victim to the lure of a high-return investment scheme. Despite all their knowledge and caution, they ended up losing a substantial amount.
The very officers from the financial institution who once called theme daily have gone silent. Their calls and messages are left unanswered — a painful experience they know many others are also enduring.
Despite all complications, if you're looking to invest, here are some essential tips to help you proceed with caution:
Clarify Your Investment Goals
Start by understanding why you want to invest. If your goal is long-term financial stability — like building a retirement fund — it's wise to stay away from risky, high-return options.
High-risk investments might offer attractive returns, but they can also wipe out your savings. A financially sound institution with a strong track record can justify a calculated risk, but always assess whether it aligns with your long-term goals.
Remember, a savings account, while offering low returns, remains a safe and accessible place for emergency funds.
Avoid Putting All Your Eggs in One Basket
One of the biggest mistakes is placing all your savings into a single high-return product. If that institution collapses, so might your entire savings. Diversifying your investments can protect you from such catastrophes.
Create a balanced portfolio — mix low-risk and high-risk products to spread out the risk.
Research the Financial Institution
Before investing in any product, especially one promising higher-than-average returns, conduct a thorough background check.
Be wary of promotional messages — WhatsApp forwards, texts, or emails — offering fixed deposits with suspiciously high interest. If it sounds too good to be true, it probably looks into—
- Regulatory compliance
- Market reputation
- Transparency in communication
- How long the institution has been operating
Think Long-Term
Successful investing is a marathon, not a sprint. Short-term gains may seem attractive, but they're often unreliable. A patient, consistent investment approach typically delivers more stable and rewarding outcomes over time.
Steer Clear of 'Get-Rich-Quick' Schemes
If someone promises high returns with little to no risk, consider it a massive red flag.
Scams like Ponzi schemes have devastated countless investors. Take the case of Bernie Madoff — many lost everything after being lured into his fraudulent high-return promises. Stay sceptical and cautious.
Consider Safer Options like Shanchaya Patras or Government Bonds
Government-backed investment products like Shanchaya Patras are among the safest options available. There are three types based on tenure and return rates. You can invest up to Tk 50 lakhs individually, with tax rebates available for investments up to Tk 5 lakhs. Speak to your bank branch for specific guidance.
Stock Market Investment: Know the Risks
While the share market can offer higher returns over time, it also comes with significant risk. Currently, the market is volatile, with many stocks falling in value. Although there's speculation of a recovery, the outlook remains uncertain.
Only invest in stocks if you are prepared for ups and downs, and never put in money you can't afford to lose.
Even seasoned professionals can fall prey to risky investments. The key is to stay informed, cautious, and grounded in long-term goals. Your financial safety should never be compromised by the promise of unrealistic returns.
Before investing, ask questions, do your homework, and never hesitate to walk away if something doesn't feel right.
