There are bound to be some errors on the part of the investors. But relax, there are still some options open to you.
Here is what you can do if you have invested in a wrong place:
Investments in insurance:
It may be that you ended up investing in an unsuitable or incorrect insurance policy. In such a case, what you can do is take the help of the free-look period within which you are allowed to cancel the investment. This period is of fifteen days and begins on the day you receive the investment papers.
But in other cases, a person may realise at a very later stage that the policy does not suit him/her. Such a situation should be avoided, as a policy comes with certain periods, wherein you are not allowed to withdraw your policy and doing so can attract a considerable fine. Yet, in the worst case scenario, you can choose to have the policy surrendered or get it paid-up.
During the starting period, it is unwise to have a policy surrendered because it can lead to a loss. If you no longer wish to make payments for the policy, you can choose to get it paid-up.
From the funds that are returned, you can now consider investing in term plans as they can be cheap in comparison to insurance plans.
Furthermore, there might also be a situation where you find that the equity part of a Unit Linked Insurance Plan has a negative effect on your investment. Note that such a problem can be solved with the auto-rebalance tool that helps you balance your investment portfolio.
● Investments in Mutual Funds, Fixed Deposit and Stocks:
When it comes to an investment of this nature, it is advisable to be patient. You will need considerable time to judge whether it is performing well or not. This may be around two years for a FD. However, for a mutual fund with an equity or for a stock, this can even be around three years. At this stage, you can do a proper evaluation of whether the investment is not performing in comparison to investments of a similar nature. Further to your analysis, you can decide on selling the investment.
● Investments in Property:
Property investments are not very easy to get out of. Taking into account things such as stamp duty of as much as 5% to 15%, and the high capital gain tax, it is indeed a complicated prospect. Therefore, it is advisable to make an investment in the property only after thinking about it carefully.
Note that you can be sure about a profit or a loss on an investment in this sector only after 4-5 years of investment. Hence, you will need to have patience here to properly assess your returns. Also, you may consider consulting an expert before deciding to sell your investment.