Best Investment Plans
Grow your savings! Achieve your financial goals with tax benefits by finding the best investment scheme at Fincover.
What is meant by an investment?
Investment is often confused with savings. You invest money in an asset with the expectation that its value will increase over time. Your intention is to make profits.
You save money in a bank account to keep it safe and handy. The risk is low, and so are the interest returns.
Savings is a passive method of earning returns while investment is a more aggressive way of wealth making. The risk and the return are low in savings. The risk is high, and so is the possibility of returns in investments.
Public Provident Fund
Senior Citizen Saving Scheme
Monthly Income Plan
Why should you make Investments?
- Investments are imperative in today’s world, as merely making money is not sufficient.
- Your hard-earned money may not be enough to help you lead a comfortable and stress-free life without any financial constraints. To do that, you need to make your money work as well.
- This is where investment comes into the picture. Merely depositing your money in a bank will not help you meet your financial goals.
- You need to make good investments to multiply it manifold. This is the main reason why investment plays a significant role in financial planning.
Here are a few advantages of investing your money,
Types of Investments
We can classify investments broadly into two types – Traditional Investment & Alternative Investment. An Indian investor has several options in both these categories,
Investments in financial products that have been around for generations fall under Traditional Investments.
Being a proven model that helps your money grow, many investors still consider Traditional Investments a safe bet.
Some of them are,
• Equity Mutual Funds - Investment in stocks and equities
• Debt Mutual Funds - Investments in bonds and government securities
• Hybrid Mutual Funds - Investments in a combination of equity and debt
Non-traditional and complex investments are termed Alternative Investments. It includes investment in gold, precious metals and other commodities that are expected to fetch profit in the future. Hedge Funds, Private Equity and Venture Capital, are a few forms of alternative investments. They have relatively low liquidity and also require a high minimum investment. Hence, they have not become widely popular in the Indian financial markets.
How to select the best investment plan?
The first step in planning your investments is to shortlist the best investments that fit your requirements and needs. Here are a few things that you need to keep in your mind before choosing an investment plan:
Your age group – Young investors have a longer time horizon. You can select long-term investments with a scope even to increase your investments as you grow in your career. Young investors can afford to take risks as they have time on their side. On the other hand, older investors can opt for safe and guaranteed investment plans like Fixed Deposits.
Define your goals – Your goals may be either short-term or long-term. For short-term goals, ensure you opt for safer investment options that offer guaranteed returns. For long-term goals, analyze the returns potential of the investments.
Define your risk appetite – Don’t fall for schemes that promise you huge returns if you cannot afford to make a loss. Analyze the profile of the investments you want to target not only by returns but by their risk profile.
Avoid investing – in plans that are too complex for your understanding.
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