What are the best investment options for middle-class individuals in India?

People make investments in order to meet all their requirements that arise in future including expense for the child’s education and retirement plans. Investment plays an important role in everyone’s life and is one of the major decisions that require a lot of research. The online medium provides great help as these days you can easily get all the important information online. You should consider all the important factors so that you can select the best investment option as per your need and affordability. Make the selection as per your objectives and risk appetite. 

Some investments have greater risk while the other investments involve less risk. Generally, middle-class individuals opt for those investments which give them good returns and involve less risk. But do not forget the fact that those investments which have a greater risk also promise higher returns. Risk and return are the related terms. You need not worry as a lot of investment options are available in the Indian market and you can choose the investment option as per your risk-appetite. 

Check out some of the best investment options that are available for middle-class individuals in India: 

Unit Linked Insurance Plan: 

Unit Linked Insurance Plan is the best investment option as it is the combination of insurance cover and investment option. Insurance companies provide you life insurance cover and at the same time, they also invest a portion of the premium in debt and equity markets. So this way you can enjoy the benefits of both that is insurance and investment. You must check the credibility and past record of the insurance company from whom you are planning to take Unit Linked Insurance Plan. If you are a person who has a higher risk appetite then you go should go for it. 

Real Estate: 

Nothing could be better if you have the amount to invest in Real Estate property. It is considered to be on the list of best investment options available in the Indian market. Real Estate sector is growing at the fastest rate. The risk that is involved in investing in realty is quite low. The price of the property rises within 6 months so it is worth to make an investment in the Real Estate. Investing in a flat or plot would be one of your best decisions that you will never regret in your lifetime. 

Public Provident Fund: 

Public Provident Fund is a suitable investment option for the middle-class individuals. Under section 80C of Income Tax Act, a person enjoys various tax benefits for investing in Public Provident Fund. For opening your PPF account, you need to go to the bank or designated post office. There are some banks in the market that provide this service online also. It is a less risky investment with a lot of tax benefits. The interest that you earn is tax-free and deposited amount is eligible for tax deductions. The investment period is of 15 years and you can make partial withdrawals after a certain time. You can get the investment period extended for 5 years. 

Post Office Monthly Income Scheme: 

Post Office Monthly Income Scheme is the best investment option available in the Indian market for the middle-class people. Even a minor can invest in this scheme as the minimum eligibility age required is 10 years. The investment period is of 5 years. According to 80C of Income Tax Act, you are eligible to receive a tax rebate if you have invested up to Rs. 1.5 lakh. Only in some exceptional cases like the death of the investor or court order, one can make the early withdrawal. In POMIS, one can choose a nominee so that nominee can enjoy the benefits in case of early death of the investor. 

Company Fixed Deposits: 

Company Fixed Deposits are similar to the Fixed Deposits that you make with the bank. The difference is that the Company Fixed Deposits are made with the companies and they are better than the Bank Fixed Deposits. You must check the credibility and past record of the companies with whom you are planning to make the fixed deposit so that you can ensure yourself that you have made a safe investment. An investor should choose the term wisely as once the amount is deposited with the company it cannot be withdrawn before the maturity. It is a long-term investment with high risk. 

Bonds: 

It is the best investment option for those who do not want to spend in equity and mutual funds. Bond is considered as a safe investment and ensures public higher returns than other investment options. There are a variety of Bonds available in the market including Zero Coupon Bonds, Convertible Bonds and more; you can choose as per your need or requirement. The risk of losing the principal amount is quite low in the Bonds. That is why a Bond is one of the best options for making an investment if you are a middle-class individual and not comfortable to invest in equity and mutual funds. 

Conclusion: 

Investment provides financial help for the future requirements including retirement funds, expenses for child’s education and more. Before investing in any of the investment options you should think and do a lot of research. The online medium can help you to select the best investment option available in the Indian market. It is one of the major and important decisions that one makes in order to fulfill all the future requirements. Also, do not forget to check the credibility of the organisation with whom you are depositing your amount as it ensures that your investment is in safe hands. Remember the fact that all those investments which involve a higher risk also promise to provide you higher returns. Be wise and make your investment decision after considering various important factors. 

If you are looking for some of the best investment options for middle-class individuals in India then you are at the right place; do scroll up the page.

Short Term Investment & Long Term Investment Plans In India

Short Term Investment Plans in India

Any investment scheme that has a time period of 1 to 5 years is distinctive of a short term investment. There are quite a few advantages in opting for short term investment plans as compared to their long term equivalents. If an investment plan is a short term one, the risks are less and the money is not kept locked up by the bank or any other financial institution. The return on the investment (ROI) is also quite sizeable. Here is a brief on some of the best short term investment plans.

Fixed Deposits:

Without a doubt, FDs are the most secure short term investment plans available. This scheme provides a fixed rate of interest that ranges from 4 to 11% yearly. Though the money cannot be withdrawn before its maturity period, fixed deposits come with a period/tenure of 10 days to 10 years. Interest is paid 3 months after the initiation of the deposit and is exempt from tax deduction under Section 80C of the Income Tax Act, 1961. Untimely withdrawals may involve a penalty, but that is decided upon by the bank.

Savings Account:

A Savings Account is another reliable and secure mode of short term investment, which can be primarily used for liquidity. An account like this can be opened with any bank or financial institution and money can be kept till required. Banks pay around 4 to 7% interest rate, depending on the amount and duration for which the money is reserved in the account.

Gold Investment:

Investment in gold is deemed to be one of the wisest options when it comes to investing for a short duration. This very in-demand yellow metal can come handy in uncertain times as it offers protection and stability during banking crisis, inflation or social unrest. Another benefit of investing in gold is that any inclination in the financial market does not have any effect on the value of the metal. With the demand for the precious metal on a constant increase (especially in a country like India), there has been a 23.5% return on investment in the past few years.

Liquid Funds:

Liquid funds are ones that have a high liquidity value that can be invested in a certificate of deposit or short term securities offered by the Indian Government. These funds are essentially short term Investment Plans that have a Low Risk and low return investment while offering a fixed current income. In order to avoid fluctuating interest risks, the maturity of this fund is 90 days.

Long Term Investment Options in India

Long-term investments are investment schemes that have a term period of over 5 years. They play a vital role in the larger scheme of things, wherein you might need accrued amounts; for example, in your child’s education or to buy a land/property. It is, therefore, imperative to have a solid know-how of the kind of investment options that you are opting for.

The most common Long Term Investment Options are -

Employee Provident Fund/Public Provident Fund:

Provident or pension fund is a savings scheme that is provided by every employer to every employee in which a small portion of the employee’s monthly income is deducted and diverted into his/her Provident Fund. This amount can only be withdrawn by an employee upon leaving the organization or upon retirement from it.

National Savings Certificate:

Offered by the Post Offices in India, it is one of the traditional investment implements that is exceedingly favoured by senior citizens and those who are looking to invest smaller amounts for longer lock-in tenures. You can invest from Rs 100/- to 1.2 Lakhs with a 6-year maturity term. The annual interest rate on NSC’s is 8% and not subject to market fluctuations. Also, the interest is not tax-free at the time of payment at maturity.

Real Estate:

Investment in real estate (land and property) is a very smart investment alternative as the appreciation in the value of real estate has been exceedingly encouraging and almost always on the rise in the recent past. As an investment option, it represents good growth and is also a substantial asset to have for something to pass on to the next generation.