If you save money today, you will be on safer side tomorrow. On the other hand, if you waste money today, you will be facing financial crisis tomorrow. But India is famous for middle income people who con not have control on their spending habits and who have less awareness to increase their earnings. It is true, when we observe our neighbors and relatives who always struggle to lead their daily necessities. Today’s marketers of goods and services are no doubt misleading people through TV advertisements and serials on TVs. Two main instances we can quote here. A single serial on TV is running for more than ten years with unnecessary curiosities. This is totally time, energy and money waste on the part of people. Indian cricket matches like 20-20, ODIs and test matches are not exceptional. One more instance is mobile which boast free calls and messages. Through these entire, marketer is bagging money from people and becoming richer and richer day by day. But one who is really serious about his family in future will definitely spend economically and save and invest in bank deposits, shares and other securities. But investing directly by the investor need lot of financial idea. So, an investor may turn towards mutual fund investment which is risk free. Our paper has attempted to identify and highlight some of the key issues and challenges faced by the industry participants that are preventing the industry from harnessing its true growth potential. The challenges specific to the Indian mutual fund sector are those common to emerging markets stocks in general, which is that these companies depend heavily upon international growth. Unfortunately the outlook for international growth is not very good right now. In general, emerging market mutual funds are highly correlated to the developed markets, but even more volatile. When developed markets go up, emerging markets will usually go up even more; when developed markets go down, emerging markets will go down even more.

Keywords: Financial Crisis, Financial Instruments, Financial Vehicle, AUM, Volatile.