As an investor, your focus should be picking instruments that offer the highest returns and adequate safety. Adopting this method when investing will help you realise your short-term and long-term goals and create wealth. For best results, your investment portfolio must be balanced with a mix of high-risk as well as low-risk investments, and you must invest as soon as possible. This is because the sooner you invest, the longer you can stay invested, and the higher your returns will be. With this in mind, take a look at the most popular investment options in India that you can choose from.
If you are looking for better returns, consider investing in mutual funds. You must have a moderate risk appetite to do so, but with returns that cross the 12% mark on average, it is a calculated risk worth taking. Hire a financial expert to invest in mutual funds on your behalf and mitigate risk further. You can also choose SIPs that allow you to invest a small amount each month in high-performing funds. Not only is this pocket-friendly, but it will also help you build an investment habit.
Choosing a low-risk instrument like an FD is an ideal investment option for senior citizens, new families and practically anyone who wants to save for their future. While different financial institutions offer different FD interest rates, you can compare these rates with the help of an FD calculator and choose the option that offers you the best returns. Since this instrument isn’t linked to the market, you can be assured that you will receive the amount promised to you as long as you pick one from a reputed financial institution.
If you are looking for higher returns on your FD investment, as you should, it is advisable that you choose company FDs. They are far more rewarding compared to FDs offered by private and public sector banks. Besides, you may choose to opt for a cumulative or a non-cumulative FD scheme depending on whether you want to build wealth, or receive regular payouts for periodic expenses. Choose a NBFCs Fixed Deposit as it offers you 8.40% interest that can go up to 8.75%, with a deposit amounts as low as Rs.25,000 and a host of other features like minimal documentation and low premature withdrawal fees.
Provident Fund (PF)
PF is another popular and secure investment scheme that you should consider. You can invest a minimum of Rs.500 in Provident fund with a maximum of Rs.1.5 lakh per annum. Since the government backs it, you know that the investment is secure. Also, under Section 80C of the IT Act, you can claim a deduction of up to Rs.1.5 lakh when you invest in PPF, and the interest is tax-free too. This scheme has a lock-in period of 15 years and it offers you interest amounting to around 7.6%.
Real estate is considered to be a good investment option as property is always appreciating in value. So, what you buy today for Rs.7 lakh may fetch you close to 10 times the amount 15 years down the line. Apart from handsome returns, when you use a home loan to purchase real estate, you can enjoy tax benefits too. Additionally, rental income in the interim can help you cover supplement your income, especially once you retire.
You can invest in gold in various forms such as jewellery, bullion, gold bonds, digital gold, etc., but refrain from investing in jewellery as its value diminishes and the making charges add to the cost. Instead, opt for gold ETFs, a type of mutual fund where every unit is backed by 1g of gold. You can trade these ETFs electronically, and enjoy substantial liquidity as well. However, remember that the gold market can be volatile too and the price of gold can drop or remain constant for years. So, don’t park a huge portion of your investment corpus in gold.
Identify your financial goals and risk appetite and accordingly detail your investment plan. Choose from these options to create a balanced investment mix and watch your money grow!