Shall I send my business and invest in Mutual Funds?

[newtrader101]

Thank you, everybody, for your suggestion and detailed explanation.

After reading all suggestions, I am planning to continue my hotel business. As there, I can increase daily rent, as inflation rises. But in Stock Market my income will be fixed at 15% to 20% of 1cr only. In long run 15 to 20% of 1cr will not be enough.

Once again thank you for suggection

Leasing it out could also be an option.

 

[TracerBullet]

Thank you, everybody, for your suggestion and detailed explanation.

After reading all suggestions, I am planning to continue my hotel business. As there, I can increase daily rent, as inflation rises. But in Stock Market my income will be fixed at 15% to 20% of 1cr only. In long run 15 to 20% of 1cr will not be enough.

Once again thank you for suggection

Markets returns compound if you allow them. If you dont take out all returns and atleast let it grow beyond inflation, then your portfolio will be able to handle inflation. So if market gives 10%, inflation at 5% then you should not take out more than 5%. But ofc, inflation numbers may not indicate actual inflation that you experience based on your own expenses.

You should still consider investing what you can into Equity ( simple Nifty Index with low expense ratio will do - or your own investing style if you can manage ) through SIP type investments. This can be some type of retirement plan, as long as you don't run when market crashes. This will atleast diversify your income and might do better than your business in the long run.

Ofc, if you can do much better than market through business, then no need. Good luck.

 

[HirendraRamamuthe]

It's possible to trade while you're at work or running your own company. As a hotelier, of course. I don't think it's a good idea to sell it. Keep it going and try to start a side business.

 

[MahindraSatrujit]

I think selling your hotel is a big decision. Mutual fund investment is a good idea but you can do that without selling your business. Please take your time and make a wise decision after considering the pros and cons.

 

[Kusum Sarkar]

I think you shouldn’t sell, it doesn’t make sense to give up a business for investments. Think a little practical, how do you plan on making strong moves if you put all your money in one investment? What happens if you lose? Stick with your business, save up some money on the side and use that to make investments.

 

[Sanya Kapoor]

Take a beat and ponder upon how you wish to carry out your next move. Weigh the pros and cons of not being a business owner anymore and how does that make you feel? I suggest that you do not take such a rash decision. Giving up a business is a lot, selling is more than that. Try and see if you could handle managing both? If not, save up until you can invest.

 

[Susheel Joshi]

No, do not sell your business initially. You need to make sure you have savings. If you sell and then invest, you will be putting all your money into one investment and that doesn't sound like a practical plan that will bring you profit in the long run. It is a huge risk, so instead you can just save some money on the side and invest that while you continue to run your business. Hope this helps you decide smarter!

 

[aayushpatni]

I think you should not sell your business, just to put your money in mutual funds. I have few valid reasons to support my point.
You will not get 1 crore. Its before tax amount. There is a 20% capital gain tax.
And also, if you require regular income, it is not possible in case of mutual funds. As, it cannot guarantee monthly returns.
Sometimes, you might have to sell it at losses to pay your child school fees, etc.
Also, you have to remain invested for very long term, if you require 15% or so returns as you are expecting. Returns are variable, not fixed.
From this, either try to start a new business, as your age is just 39. From the savings, you can invest regularly in stock market. There are many good investors and traders in this forum, who can guide you on that.

When the returns are low in your business, you can sell it to start something new - but it should be a business, not investing.
Capital market is a place where you can grow your capital in the long run, but the earning source should be different.

 

[Jai Kapoor]

No, please do not make this mistake. I had an uncle who was going through a similar scenario and he lost everything in the matter of a few weeks. This may not happen to everyone but right now, your best bet is to keep your business and save up some extra money so you could use that to invest. It is a better option compared to selling. Good luck!

 

[Deveshwar Banerjee]

I think that this is a very big and bold decision that might cost you a good amount of money. You have to consider other angles of doing such a thing because every financial market comes with risks of losing money. Whether the business is working poorly or not, at least there is some assurance that you will earn through your business, but there is no guarantee or assurance in investing. You can market your business or promote it to run it, but you cannot do anything like that in investing. Investing does not work the way people think; it is not that easy to earn money in any financial market. It is better not to take any step further without considering the consequences.