When you invest in a mutual fund, you pay an entry load to pay commission to mutual fund agent through whom you submit your application form. If you are investing Rs. 100 in a mutual fund with and entry load of 6% then your actual investment is only Rs. 94.

If you  buy mutual funds directly from the fund house you save money on the 'entry load'. If you choose not to use the services of an agent, you can save anything between 2 to 6 per cent of your invested amount.

Here is how to go about it if you are a beginner in Mutual fund investing:

1: Go to the office of the mutual fund house

All you have to do is to visit the office, fill up the form, submit the documents and voila, you have saved 2 per cent. It is important to remember that your bank and the mutual fund house, even if they belong to the same group, are separate entities.

For instance, if you want to invest in a mutual fund scheme from ICICI Mutual Funds, you cannot go to the nearest branch of the ICICI. In this case, the ICICI will act as an agent for ICICI Mutual Funds, and you will not save on the entry load. Find the ICICI mutual fund branch and submit your documents with them.

2. Submit application at a collection centre or investor service office

When you submit your application at the collection centre or investor service centre you will not have to pay the entry load. If the fund house does not have an office, collection centre or investor service office in the city, you could courier your form. If the cost of the courier is the same as the entry load,then it  make sense to hire an agent and save yourself the trouble.

3: Buy them online.

The easiest way is to invest in the mutual fund of your choice by visiting the web site of that particular fund house. Fill up your personal and investment details as asked in the application form and quote your Permanent Account Number (PAN) (this is mandatory).

You can pay through your bank account debit card or online bank account if that fund house has tied up with your bank otherwise you can mail your check to them.

If you opt for a Systematic Investment Plan (SIP), choose the Electronic Clearance Scheme (ECS). Some fund houses do not offer SIP investments, online. In this case, you will need to visit a branch to do the same.

4. Documents required:

You will need to submit the following documents when buying mutual funds:  

      * Application form
      * Cheque, demand draft (depending on mode of purchase)
     * Copy of PAN card attested, by an officer at the mutual fund office, your financial advisor, your bank manager, any gazetted officer/notary or judicial authority.

5. Best option: Agent or direct purchase

Agents might be helpful if you have no clue as to which mutual fund to invest in. But remember the agents have an interest in selling you a particular mutual fund because they get commissions.

If you are confident and clear about investing in a particular  mutual fund scheme then the direct invesment method is for you as it saves you some money.