Understand Growth and Income Funds
Learn about growth and income funds. The goal of these funds is to provide long-term capital growth for investors while giving consistent income along the way.
Assess your goals and come up with a sound investment strategy. Portfolio managers use a variety of ways to manage growth and income funds. Some choose to divide their investments equally between growth stocks and income stocks, while others prefer to pursue high-potential growth stocks more aggressively.
Determine your risk level. As with most mutual funds, there are some risks associated with investing in growth and income funds. Investors who are willing to take low-level risks to achieve growth while maintaining moderate income growth usually do well with growth and income funds.
Buy and Manage Growth and Income Funds
Locate a fund you feel comfortable investing in.
Find out if you can purchase the fund directly from the company. Some companies sell their shares directly to the general public, which is the least expensive way to invest in a mutual fund.
Contract a financial adviser to help you purchase the fund and manage it effectively. Not only will you be investing your money, but you'll also be getting valuable financial advice.
Consider using a fund supermarket. You'll have access to a wide variety of different funds if you choose this method, all offered with no sales charges or transaction fees. In addition, you'll have the benefit of additional record keeping and fund consolidation assistance.
Find out if your employer offers growth and income mutual funds as a retirement investment option. Using your company's plan means you won't have to worry about the specifics on how to manage your funds.
- It is common for financial planners to charge either a percentage of the assets or a flat hourly fee. It's best to choose an adviser who charges a flat fee.
- Keep in mind that there may be more restrictions on investments purchased through a company-sponsored plan. You'll want to take into consideration any redemption penalties unique to the plan, as well as any restrictions on buying and selling, before you make your decision.
- Although most mutual funds purchased directly from fund companies are sold without sales charges, some companies may charge an initial fee. Funds that charge initial fees are known as low-end funds.
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