How many of us do our level best to invest and save all our hard earned money? Now, the fact remains, investing is a risky game if you dont understand the market, your financial needs, or the returns they generate. And if mutual funds seem like a viable prospect, it pays to understand exactly what youre getting into. Financial advisor, Priti Rathi Gupta, and founder of LXME, Indias first financial planning platform for women, addresses some important questions one must ask themselves when considering an investment in mutual funds.If a person is new to investing, are mutual funds considered the safest to invest in?Yes. Investing in mutual funds is like diving into deep waters with a life raft and a navigator. Diversification and funds being managed by experts will ensure safety of your assets. Moreover, mutual funds offer a great option to invest on the basis of your timelines and goals.What are some important aspects to remember when investing in mutual funds?The philosophy is simple: in a sky full of mutual funds, pick a STAR. S stands for the style of the fund. This means its classification as per equity, debt, hybrid, and more. T is the tenure you are willing to lock in your money for. A stands for the asset being managed by a fund manager, and R is for risk return spot. Based on the tenure and style of fund, and after evaluating the informed risk you can take, choose a fund that will aim for capital protection and give you a good return.How can one identify the objective of their investment and choose their plan accordingly?It is critical to have two financial goals in placebuilding an emergency fund for an unprecedented rainy day, and a retirement fund for a comfortable living and stable flow of income post retirement. All financial goals should be defined with a timeline in mind as to target the best returns; you should invest your money in instruments that are best suited for different timelines. For example, an emergency fund should be liquid and thus be kept in debt funds or arbitrage funds over equity funds that tend to be more volatile over short durations. Long-term goals like planning for retirement can be best achieved through equity mutual funds that yield best returns and perform well over a period of time.What is the fundamental difference between tax saving mutual funds when compared to other available mutual funds?Tax saving equity linked saving schemes invest in equities and are also called as equity linked saving schemes (ELSS). These funds have a three-year lock-in period which instils disciplined investing. The investments in ELSS are eligible for tax deduction under section 80C of the Income Tax Act, 1961. They also target great returns over a longer period of time.Is it advisable to employ the help of a financial planner/advisor when it comes to understanding and managing your financial portfolio?Yes, like with clothes even in investments, theres no one size fits all. However, you should not be completely dependent on a financial planner and put in time and effort to understand the basics of financial planning and investing yourself.How does a person know when a fund is right for them?Financial goals differ across life stages, more so for women as women tend to take more career breaks, earn less than men due to the evident gender pay gap, and have a longer life expectancy. Finding the right fund is a function of your goal timeline, risk appetite, historic returns of the fund, and performance of the fund manager. This usually involves time, effort, and a good understanding of the domain since youre choosing the right fund from over 2,500 funds in the market. Thus, seeking advice from an expert who understands your profile helps the process. When it comes to investing in mutual funds, is a monthly plan or a one-time lump sum an advisable way to invest?A monthly smart investment plan (SIP) is a disciplined way of investing and helps to spread out the risk, as your money enters the markets in its ups and downs. This helps to average out the market volatility. However, investing in lump sum isnt a bad idea either. It depends on whether your investable surplus is regular or in bulk. Both are great ways of investing, as long as youre investing your money right.What are some of the risks that a first-timer should keep in mind when considering a particular mutual fund?When choosing a fund that will work for your timeline and financial needs, consider the lock-In period and evaluate liquidity. Analyse your short term goals and be conservative with debt funds. For medium-term goals, slowly but surely choose opt for an aggressive fund which is a mix of debt and the right equity. For long term-goals, its best to choose funds that are a little more aggressive or equity funds.Are all the returns subject to market performance, or will certain funds guarantee a steady return?Fixed income funds or debt funds ensure steady returns. Liquid funds or gilt funds are guaranteed, without messing with your contribution.What advice would you give someone considering an investment in mutual funds?Its always a good time to invest. In fact, the right time was yesterday. Set aside an emergency fund first. Start building your retirement fund with long-term mutual funds. Tax saving is a great way to enter mutual fund investments. Evaluate your financial goals, define them with timelines, and then evaluate the best suited mutual funds.