Which are Best Investment Options in India for 2019? Where I should invest my money for getting better returns? These are some common questions popping up in investors mind. In this post, I will try to answer these questions.
How to Find Best Investment Options?
How to Find Best Investment Options? Which one is the best investment option as per you? Well, an answer to this question varies based on person to person. Let’s try to do one small exercise. Take a quick break of two-minute and answer one simple question. Which one is the best investment option as per you? Your answer could be –
- Stock Market
- Fixed deposit
- Mutual Funds
- Real Estate
Your answer could be fixed deposit, mutual funds, the stock market or real estate. Whatever be your choice one thing is sure that while making a choice you must have considered your goal, expected returns, investment horizon, and associated risk factors.
So, in order to find out the best investment options for yourself, you need to consider the following factors.
Also Read – 10 Best Investment to get regular monthly income
#1. Financial Goals & Expected Returns
The first thing you need to consider before finalizing investment option is your financial goals and expected returns. The financial goal means the purpose of investment. Some examples are retirement corpus, children education, buying a house, etc. Once you decide your goal you need to find out the investment required for every goal. Once you have this information on your hand it is very easy to select an investment option.
#2 Investment Horizon
The second thing you need to consider is the investment horizon. You want money in the short term or your goal is far away and you can stay invested for a couple of years. Remember the best investment options for the shorter duration is different compared to the long term.
#3 Risk Factors
The third most important factor for consideration is the risk factor. The risk-taking ability and capacity to withstand losses differ from person to person.
For example – If you have recently started job and you don’t have much liabilities your risk taking capacity is higher. If you are in the middle age or retirement age your risk taking capacity might be lower.
Also Read – 10 short term investment options in India
Based on these factors I have divided Best Investment Options in the following categories –
# Best Investment Options for Salaried (Low & Medium Risk)
# Best Investment Options for Businessmen (High Risk)
# Short Term Best Investment Options in India
# Long Term Best Investment Options in India
19 Best Investment Options in India for 2019
# Best Investment Options for Salaried (Low & Medium Risk)
#1 Bank Fixed Deposit
Bank Fixed Deposit is one of the most popular investment options for salaried. Bank Fixed deposit offers moderate returns. You can expect 6.5% to 8% returns from bank fixed deposit. Fixed deposit is available in cumulative and non-cumulative options. The interest income is taxable. If you are in the highest tax bracket, the post-tax return will be very low.
Expected Returns – 6.5 to 8%
Time Duration – 7 Days to 10 Years
Risk – Low Risk
#2 Public Provident Fund
Public Provident Fund is the next best investment option for low and medium risk investors. PPF is safe and secure investment options and highly preferred by salaried people. The return from public provident fund is completely tax-free. However, PPF has lock in period of 15 years. If you are looking for long term investment option you can invest in PPF.
Expected Returns – 7.5 to 8.5%
Time Duration – 15 Years
Risk – Low Risk
#3 National Pension Scheme
National Pension Scheme is gaining rapid popularity nowadays. This is mainly due to tax benefits. NPS offers two choices. Auto and Active. Under Auto, the funds get automatically invested in various assets, whereas in Active investor need to make the choices. The Lock in period in NPS depends upon age of investor.
Expected Returns – 9 to 11%
Time Duration – Long Term
Risk – Moderate
#4 Tax Saving Deposit
Tax Saving FD is another best investment option for salaried. Tax saving FD offers moderate returns. However it is considered as one of the safest option for investment. Tax Saving FD comes with lock-in period of 5 years.
Expected Returns – 7.6%
Time Duration – 5 Years
Risk – Low
#5 ELSS
ELSS (Equity Linked Saving Scheme) is next in the list of best investment options of salaried. ELSS offers higher returns compared to other tax saving instruments. You can invest in ELSS via SIP route with minimum monthly SIP of Rs.500. Lock-in period of ELSS is 3 years.
Expected Returns – 11-13%
Time Duration – 3 Years
Risk – Moderate
#6 VPF
A salaried people can also invest in EPF via Voluntary Provident Fund. VPF is an extension of the EPF. VPF falls under tax exempt category. It is safe investment option. Withdrawal from EPF is allowed under various conditions.
Expected Returns – 8.5-8.66%
Time Duration – Long Term
Risk – Moderate
# Best Investment Options for Salaried & Businessmen (High Risk)
#7 Stock Market
Stock Market is best investment option for high risk investors. Invest in stock market if you are comfortable losing as much as 50% of your capital. A stock market investment require lot of knowledge. You need to analyse stock thoroughly before making investment. You can take help of stock market expert for identifying best stock for investment.
Expected Returns – 6-15%
Time Duration – Long to Medium Term
Risk – High
#8 Mutual Funds
Equity Mutual Fund is comparatively safe and convenient way of investing in equity stock market. Mutual Fund generate higher returns in the long run. You can invest via SIP or lump sum in equity mutual funds. Minimum monthly SIP in mutual fund is Rs.500.
Expected Returns – 9-15%
Time Duration – Long to Medium Term
Risk – High
#9 Initial Public Offer
Initial Public Offer (IPO) is high risk high return investment option. The best part is your money will remain block for 7 to 15 days. A good IPO can fetch very good returns at the long run. You have to be careful in making selection of IPO, otherwise you are likely to lose money.
Expected Returns – 10-20%
Time Duration – Long Term
Risk – High
#10 Real Estate Commercial
Commercial real estate property provide capital appreciation and rental income both. This option is likely to provide higher capital appreciation due to growing demand of office space. Investment required under this option is very high. You need to be careful in selecting location, building quality, market space rent and supply demand while investing in commercial property.
Expected Returns – 12%
Time Duration – Long Term
Risk – High
#11 Gold
Gold yellow shining metal is considered as safe heaven by many investors. In last few years, gold has given consistent returns to the investors. If you are planning to invest your money in gold, it is recommended to invest via Gold ETF or gold bonds.
Expected Returns – 10%
Time Duration – Medium to Long Term
Risk – Moderate
#12 Company Fixed Deposit
Company Fixed Deposit is one of the very good investment option for high risk investor. Company FD provides higher returns compared to bank FDs. You need to be careful in making selection of company fixed deposit. Make sure to check rating and past performance history before selection.
Expected Returns – 10%
Time Duration – Medium to Long Term
Risk – High
# Short Term Best Investment Options in India
#13 Liquid Mutual Funds
Liquid Mutual fund is low risk investment option. It is short term investment option and provide higher liquidity. These type of mutual fund invests your money in bank FD, T-bills, commercial papers etc. with maturity period of less than 91 days.
Expected Returns – 6.5%
Time Duration – Short Term
Risk – Moderate
#14 Recurring Deposit
Recurring deposit is type of fixed deposit where money can be invested in small proportion on monthly basis. The return generated by recurring deposit is almost same as that of fixed deposit.
Expected Returns – 7%
Time Duration – 3 Years
Risk – Low
#15 Ultra Short Term Debt Mutual Funds
Ultra Short Term Debt Mutual fund is debt mutual fund. Ultra short term debt mutual fund invests in fixed income instruments with liquidity and short term maturities. Ultra Short Term Debt Mutual Fund is one of the best investment option for shorter duration.
Expected Returns – 7-9%
Time Duration – Short Term
Risk – Low
#16 Monthly Income Scheme Post office
Monthly Income Scheme of post office is one of the safest investment option. If you are looking for regular monthly income you can plan to invest in MIS. It is popular investment option for retired or old age person.
Expected Returns – 7.7%
Time Duration – 5 years (monthly income)
Risk – Low
# Long Term Best Investment Options in India
#17 Direct Mutual Funds
Direct Mutual Fund is best investment option for person looking for capital appreciation and wealth generation. The expense ratio of direct mutual fund is very low. You can invest in direct mutual funds via CAMs or other mutual fund platforms.
Expected Returns – 16-18%
Time Duration – 5 years
Risk – Moderate
#18 Real Estate Residential
Real Estate investment is another long term investment option. If you have surplus money you can invest in residential real estate property. You can get rental income as well as benefit of capital appreciation.
Expected Returns – 11%
Time Duration – Long Term
Risk – High
#19 Blue Chip Stocks
Investment in blue-chip stocks is one of my favorite investment options. You can invest in blue-chip stocks for a longer duration. This option is likely to give you higher returns. Blue Chip stocks pay a regular dividend as well as provide capital appreciation. If you have surplus money it is highly advisable to invest in blue-chip stocks.
Expected Returns – 12-18%
Time Duration – Long Term
Risk – High
Over to you –
Which are best investment options as per you?
Do share your queries and experience in the comment section given below.
