An average Indian who has just started his career is always on a lookout for the best investment options and plans available to park his money. While traditionally, Indians have always been conservative when it comes to their investment decisions, with changing times, they are also opening up to taking financial and investment risks.
The Indian financial market offers a wide range of investment avenues. However, the asset class that an investor opts for solely depends on the risk appetite of the investor. As investors, we all look for a certain assurance and safety before investing as a precautionary measure in case of unfortunate market instability. A higher level of safety comes attached with a cost: investors would definitely have to compromise a bit on the returns, since one cannot be expecting higher safety with higher returns at the same time.
There is countless number of ways to invest money that can give you high return, some of which may be surprising for the first time investors. They each have their differing benefits, interest rates and timelines. Here are some safe and most profitable ways to invest for beginners:
Recurring Deposits (RD’s)
If you are able to keep aside a small amount from your salary, the best option for you would be recurring deposits. At the moment, the only issue with recurring deposits is that the interest rates are really low. The benefit here is, the interest earned is taxable which will help to reduce your overall post tax returns. RD’s are a great option for people who have a set target in mind for a particular event, e.g. marriage. One can opt for the tenure and amount to be invested on monthly basis.
Gold
Gold may seem to you like an outdated investment that no longer holds value in today’s economy. However, gold is one physical asset that will back you up during a financial crisis and therefore remains a smart investment if invested correctly. While investing in gold, it’s necessary to remember investing in gold coins or bullion bars and not a jewelry piece for which you would have to pay additional making charges.
Mutual Funds
Today, investing in mutual funds are easy. They give you more interest on your investment in comparison to what a Fixed Deposit or savings account would give. Mutual funds have myths linked like limitation on withdrawal and higher risk which is weakening day by day. You can select your Systematic Investment Plan (SIP) and start investing small every month.
Stock Investments
If you’re someone who doesn’t prefer investing in mutual funds, then investing in direct equity is the best option for you. Here, you have to make direct stock purchase of companies you think are performing well and will do good in the near future. Equity stocks have the best returns if chosen wisely. It has been proven world over that investing in equity is the best investment option for long-term.
Bonds
Bonds are loans which could either be government bonds or corporate. When you invest in a bond, you are actually loaning a sum of money to the government. After sometime, that particular entity has to pay you back with added interest on it. For investors who prefer security over risk and returns and have a long term investment plan, they have an option of investing in tax-free bonds.
These are just few of the ways you can initiate investing in. You may choose to take your decisions basis the investment opportunities available during the economic conditions.