Considering the uncertainty of life, people are looking to grow their savings so they can accumulate corpus that ensure a financial security for their family. It’s better to make a financial investment that ensures financial benefits in a future time frame by way of interest earnings, dividend or capital appreciation that provides higher returns on the principal amount.
When it comes to achieving your family’s financial objectives, investing money with financial instruments can help you to grow your hard earned money and ensure a robust financial stability in the future.
In this blog, we are discussing about top 5 financial investment options in India:
- 1. Public Provident Fund
- 2. Unit Linked Insurance Plan
- 3. Fixed Deposit
- 4. Recurring Deposit
- 5. Mutual Fund
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1. Public Provident Fund
PPF or Public Provident Fund is a long term debt scheme launched by the Government of India which offers attractive interest rates with tax-free returns. It is one of the most secure investment options that offer, the interest rates at 8% per annum compounded annually.
Any Individual in India can open a PPF account in any post office and some authorized banks. It provides a long term investment for 15 years, wherein you also have the option to extend for a block of 5 years after maturity. Under a PPF account, the minimum deposit amount is Rs 500 and maximum is Rs 1,50,000 in a Financial Year.
2. Unit Linked Insurance Plan
ULIP or Unit Linked Insurance Plan is actually a market-linked product that provides a dual benefit of investment plus life cover. A ULIP plan provides various fund investment options that help you to grow your investments. A life cover ensures a financial security for your family, in the event of your demise within the term of the policy.
A ULIP investment helps you to fulfill your medium to long-term financial objectives. Under this policy, you have the flexibility to switch/redirect your funds that suit your financial goals and risk appetite.
When it comes investing in ULIPs, you can go ahead with Future Generali Life ULIP plans, Bajaj Allianz Life ULIP plans, ICICI Prudential Life ULIP Plans, Kotak Life ULIP plans, and many more. Do your research and choose a ULIP plan that can help you to fulfill your financial objectives.
3. Fixed Deposit
FD or Fixed Deposit is a financial instrument provided by banks, wherein you can earn a higher interest compared to a regular savings account. FD is considered to be a very safe investment. For opening an FD account, the minimum deposit required is Rs 1,000. At SBI, for opening an FD account, you need to pay a minimum amount of Rs 1,000 and for HDFC, it is Rs 5,000. The tenure for which you can invest in an FD is 7 days to 20 years and the interest rate varies in a range of 4% to 11%. With an FD account, you also have an option to avail loans up to 80-90% of the value of deposits.
4. Recurring Deposit
RD or Recurring Deposit is one of the topmost investment options in India and it is suitable for risk averse investors seeking good returns. In an RD, you need to deposit a fixed amount every month for a pre-specified tenure. The principal amount deposited through the entire term is returned at the end of the RD term along with the interest.
An RD investment helps you to fulfill your short term financial goals. The interest rate applicable varies in a range of 7.25% to 9% and higher interest rate is applicable for senior citizens.
5. Mutual Fund
A Mutual Fund enables investors to pool their money and help you to invest with a diversified selection of securities such as exchange-traded funds, fixed maturity plans, sectoral funds, fund of funds and many more.
Your investment under a mutual fund is monitored by qualified professionals who create a portfolio consisting of stocks, bonds, money market instruments or its combination. As, your money is invested in a diversified range of securities, you can enjoy a higher return along with minimum risk involved.
A financial investment is a smart move that helps you to achieve short and long term financial goals that further provide a helping hand towards fulfilling your family’s financial obligations. When choosing a financial investment option, you should first assess your financial goals and then invest with a suitable financial instrument. You should also diversify your investment portfolio that will ensure higher returns at a minimal risk.