Seven General Principles of Successful Investing

successful investing

Seven General Principles of Successful Investing | Thumb rule? Thumb rules help with specific tasks. It simplifies regulations or actions. Everything has thumb rules, from athletics to cookery. Why should investment differ?

How should you invest in mutual funds? Secondly, investment guidelines can help us determine how fast our money increases or loses value. Then we follow some investment rules. How should we allocate mutual fund assets, prepare for retirement and emergencies, etc?

We’ve put together some financial and investing guidelines.

Seven General Principles of Successful Investing


We all want our money to quadruple quickly. The rule of 72 dictates how many years it takes to double your money.

This method can estimate how long your money will double by dividing 72 by the projected rate of return. Example: This rule. You put Rs 1 lakh in a product offering a 6% return. 72/6 = 12.

Your Rs 1 lakh will become Rs 2 lakh in 12 years.

This rule only applies to compound-interest assets.

Use the Rule of 72 to calculate how much interest you need to double your money in a specific time. To get the interest rate for doubling your money in five years, divide 72 by doubling time. I.e., 72/5= 14.4%p.a. To double the sum, you need 14.4% p.a.

ALSO READ: How Much Money Can You Make By Trading?

The “rule of 72” tells you how long it takes to double your money, but this rule triples it.

The investing principles of 114 use the same reasoning and mathematical method to determine how long your money will quadruple.

Rule 114 states that investing 1 lakh at 6%p.a. will yield 3 lakhs in 19 years.

Similarly. To grow your investment in 5 years. To quadruple your money in five years, divide 114 by 5, which yields 22.8% p.a.


Rule 144 is 72 multiplied by 2. So, the “rule of 144” can be used to calculate how many years it will take to quadruple your money if you know the rate of return.

Rule 144 states that investing Rs 1 lakh in a 6% interest product will grow to Rs 4 lakh in 24 years. Divide 144 by the product’s interest rate to find out how long it will take to quadruple the money.

The Rule of 100-Minus-Age

The 100-minus-age rule is great for asset allocation. That is, how much should go into debt and equity funds.

This investment rule requires subtracting your age from 100. Your ideal equity exposure is the result. Invest the rest in debt.

You’re 25 and want to invest Rs 10,000 every month. If you invest 100 minus age, your equity allocation will be 75%. Invest Rs 7,500 in shares and Rs 2,500 in loans. If you’re 35 and want to invest Rs 10,000, your equity allocation should be 100 – 35 = 65 percent. That means Rs 6,500 in shares and Rs 3,500 in debt.

Invest at least 10% of your income

This guideline advises investors to invest at least 10% of their salary and increase it by 10% each year as their salary package grows. Early investing maximizes compounding. Investing early pays off. Internet shopping can wait.


You must put 10% of your pay into the emergency fund, like the investing regulation. Because life can surprise you, you must be financially prepared. Before investing, save for emergencies. This rule requires saving 3-6 months’ worth of monthly spending.

To avoid financial hardship, an emergency fund should be liquid and accessible.


Follow the 4% withdrawal rule to preserve your retirement fund. Following this rule will ensure a steady retirement income. You also have enough money to make money.

If you have a retirement corpus of 1 crore, the 4% withdrawal rule suggests taking Rs. 4 lahks per year or Rs. 33,000 per month to survive inflation.

To Conclude

Every investor should follow the aforementioned investing thumb tips. Before investing, do your research and talk to a pro. So, these principles must not be blindly followed. A good investment portfolio helps you meet your financial goals while taking risk and time into account.

If you invest $10,000, you should only risk 5% of it.

Investors should not invest more than 5% of their portfolio in a single fund, according to the five percent rule.

How much of your savings should be put into mutual funds?

Salary and long-term goals determine how much a paid individual should invest in mutual funds. The minimum financial plan regulation is 50:30:20. a Simple rule. It suggests splitting your money in three ways:

50%—Your needs
30%—Your desires
20%-Investing and saving.

To develop a large corpus, invest at least 20% of your salary in mutual funds through SIPs. Increase the SIP percentage annually to reach new targets and beat inflation.

Which three guidelines should investors always follow?

Investor golden rules:

Start early.
Consult a financial advisor.

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