Safe and best investment option :Mutual Funds

Mutual funds can be a good investment as long as you remember a few things:

1. Don’t pay someone to recommend a mutual fund. You can do a little research and find the best mutual funds for you and you aren’t paying a commission to do it.

2. Make sure you understand the “expense ratio” of a mutual fund. Basically, this is what it will cost you to have this mutual fund. There can be some hidden fees, which might cost you something each year. Look for low expense ratios of 1.25% or less.

3. It is best to be a long-term investor if you are investing in mutual funds. If you only want to “try” mutual funds for a short period of time, then you will want to stay away from mutual funds that have “contingent deferred sales charges.” Just make sure you understand all charges that you will be responsible for if you sell your shares.

4. You will also want to be careful of “when” you buy your mutual funds. Never buy mutual funds just before they are going to make a dividend or capital-gain distribution. You will be paying taxes on money that was made before you even invested in it.