Investing in mutual funds is one of the simplest ways to build wealth steadily over the long run. You don’t need to watch stock charts every day or pick individual stocks. Instead, you pick a fund that matches your goals and risk comfort, and let professional managers do the heavy lifting. IDFC Mutual Fund (now part of what is known today as Bandhan Mutual Fund after acquisition) has been one of the well-known players in the Indian mutual fund space, offering a range of schemes for different kinds of investors. It gives you options from equity and debt to hybrid funds, helping you align your money with your life’s financial goals.
Start With the Basics: What Is IDFC Mutual Fund?
IDFC Mutual Fund was established in 2000 and became one of the prominent mutual fund houses in India with a broad suite of offerings. Though now operating largely under the Bandhan Mutual Fund umbrella after changes in ownership, the core principles remain the same: provide diversified investment choices for retail and institutional investors alike.
Mutual funds pool money from many investors and invest that money in a mix of stocks, bonds, or other securities based on the scheme’s objective. That diversification helps spread risk while aiming for reasonable returns over time.
Ask Yourself: What Are Your Financial Goals?
Before putting money into a fund, take a minute to define your goal clearly. Ask yourself:
- Am I investing for retirement?
- Do I need money for a home, wedding, or a child’s education?
- What timeframe am I comfortable with — short, medium, or long?
- How much risk can I tolerate?
Your answers decide the type of fund you should pick. For example, equity funds might suit long-term growth goals, while debt funds work for stability and short-term needs.
Understand the Main Fund Categories
IDFC’s schemes span the common mutual fund types:
1. Equity Funds
These invest primarily in stocks. They tend to offer higher long-term returns but come with more price swings.
2. Debt Funds
These focus on bonds, government securities, and money-market instruments. Less volatile and better suited for conservative investors.
3. Hybrid Funds
Mix of equity and debt to balance growth and stability.
There may also be ELSS (Tax-Saving) Funds, Index Funds, or Liquid Funds depending on what the AMC offers at any given time. All these types help you match your portfolio with your goals.
Complete Your KYC — Mandatory First Step
KYC (Know Your Customer) is a one-time verification step required by Indian market regulators before you invest in mutual funds. You’ll usually need:
- PAN card
- Aadhaar card
- Address proof
- Bank details
This process is mandatory and once done, you don’t repeat it for other mutual funds. Most online platforms and apps allow you to complete KYC quickly with photo uploads and e-verification.
Choose How You Want to Invest: SIP or Lump Sum
You have two main ways to put your money in:
1. Lump Sum
Invest a one-time amount in the fund. This works well if you have a large sum and a long horizon.
2. SIP (Systematic Investment Plan)
Invest a smaller amount regularly (typically monthly). This is the most popular way to invest because it builds discipline, reduces timing risk, and makes investing easy even with modest savings. Many platforms let you start SIPs with amounts as low as ₹500 per month.
A SIP calculator can help you estimate how much your monthly investment could grow over a period based on expected returns.
Decide Between Direct and Regular Plans
Every mutual fund scheme usually comes in two variants:
- Direct Plan: Bought directly from the AMC. Lower expense ratio. Better long-term returns.
- Regular Plan: Bought through a distributor or advisor. Costs a little more but you get help with selection and advice.
If you are comfortable choosing funds yourself, go for direct plans. If you want guidance, regular plans can ease the learning curve.
Make the Investment
Once you’ve chosen a fund and investment style:
- Open an account on the platform you prefer — mutual fund apps, banking app, or the AMC’s official site.
- Complete KYC if not done already.
- Select the IDFC/Bandhan Mutual Fund scheme you want.
- Choose SIP or lump sum, enter the amount, and submit.
- Confirm and pay — units get allotted based on the NAV (Net Asset Value) applicable that day.
Many online platforms let you do all this in a few minutes.
Keep an Eye, But Don’t Oblsess
Investing in mutual funds isn’t about daily price watching. A sensible review every 6–12 months is enough. Look at:
- Has your fund stayed aligned with your goals?
- Has your life situation changed?
- Do you need to rebalance your portfolio?
Short-term market noise is normal. Your focus should be on long-term progress.
Tax and Exit Considerations
Mutual funds have tax implications in India based on how long you hold them and the type of scheme (equity versus debt). Exit loads may apply if you redeem before a preset period. Always check the scheme’s details before investing.
Wrapping It All Up
Investing in IDFC Mutual Fund (now mostly under Bandhan Mutual Fund) is straightforward once you understand the core steps: clarify your goals, complete KYC, choose the right fund type, decide between SIP or lump sum, and finally invest through a trusted platform. Over time, consistent investing and patience often lead to solid wealth building.
