Top 10 Best Investment Options with High Returns

In today’s world, earning money may not be enough to fulfil your financial goals and take your dreams towards fruition. Instead of letting your hard-earned money lie idle in your bank accounts, you may consider investing in investment options such as stocks, equities, mutual funds, Fixed Deposit, or more.

Though there are so many investment options available, making the right choice may get overwhelming. To help you decide the best investment options to consider, here’s a rundown on different types of investments and their returns.

Types of Investments

Investors usually take investment decisions, based on their risk appetite. Thus, these investments are classified into different risk levels, which include low risk, medium risk and high risk. Here’s a look at these investment options in detail:

Low-risk investments – These are instruments which pay fixed income – irrespective of the changes in the business or economy. Bonds, debentures and Fixed Deposit fall under this category. Also, special investment vehicles – PPF, EPF, SCSS, Sukanya Samriddhi, National Savings Scheme and other small Post Office Schemes which are created by a government statute for specific purposes are low risk as they guarantee the returns. The returns are periodic and pre-determined.

Low-risk investments are not linked to the stock market movements and are usually governed by the interest rate movements of the financiers. However, there is always the returns are always guaranteed.

Government bonds and life insurance policies provide good returns, however, they have long lock-in periods. So, you will have to wait for a long time to earn substantial returns from these investment options. Fixed Deposit is one of the very few low-risk investments that offer stable, high returns and immediate liquidity.

Medium-risk investments – These are investments which might have a certain percentage of risk but these also pay higher returns to investors willing to invest in them. Debt funds, balanced mutual funds, and index funds fall in this category. Such instruments do have an element of debt and stability, but they have their volatility linked to the markets which can hamper your principal amount. The irregularity in earnings can make any fixed income from such investment impossible.

High-risk investments – These are investments where there is no limit to the upside along with the downside of risk-returns. These are stocks of companies, equity mutual funds, even stocks, and derivatives. The return on these instruments can give huge returns as well as chances of losses depending on various external factors to the company and internal ones. The quantity and timing of returns on these instruments are not fixed. Hence, they are at high risk.
 

Best Investment Options in India

Here is a look at the top 10 investment options Indians look at while savings for their financial goals

  • Stocks – Buying shares of companies is a one time investment plan. It is one of the easiest ways to invest your money in any business. These are part ownership units of the company which each investor buys. You can trade these shares in a marketplace called the Stock market where all trades are done electronically. It is one of the most lucrative and riskiest investment options to buy.
  • Fixed Deposit  – These are the safest investment where you are assured fixed interest at fixed intervals of time. It provides options for investing and flexibility to pay. Fixed Deposit is offered by banks and NBFCs (non-banking financial companies). Short term investment plans with Fixed Deposit can help you protect your funds against inflation.
  • Mutual Funds – These are collective investment vehicles managed by a fund manager which pools people’s money and invests in stocks and bonds of various companies and create a return. They are in the same category of risk as stocks, though slightly less.
  • SCSSSenior Citizens’ Saving Scheme is an investment plan for those above the age of 60 years. It is a government sponsored, long-term saving option which has been designed keeping in mind the requirements of retirees. This investment option pays a high and steady rate of interest as prescribed the government from time to time.
  • PPF – Public Provident Fund is one of the most common and trusted investment plans in India. It pays interest rate annually and requires a minimum of Rs 500 per annum investment. It has a life of 15 years with partial withdrawals allowed of the corpus at various points. This option also pays a high and steady rate of interest as prescribed the government from time to time.

Here’s a comparison of various types of investment options.

Top 10 Best Investment Options In India

  Risk Tenure Liquidity Returns
Direct Equity High Can be sold anytime High Market-linked
Equity Mutual Fund Moderate-High Open end* High Market-linked
Real Estate High Can be sold anytime Low Market-linked
Gold Low-moderate Can be sold anytime Varies Market-linked
PPF No risk 15 years Partial withdrawals** 7.90 percent
Bank Fixed Deposit Low 7 days to 10 years Premature exit Varies
Debt Funds Low-high Open end High Market-Linked
RBI taxable bonds No risk 7 years Low 7.75 percent
NPS Low-high 60 minus entry age Limited Market-linked
Senior Citizens’ Saving Scheme No risk 5 years Low 8.05 percent
*ELSS comes with 3-year lock-in         **Subject to conditions
For physical gold, paper gold and debt funds, long term is 3 years. For real estate, long term is 2 years

Why is Bajaj Finance FD The Best Investment Option?

Looking at various options, FD has been the favoured choice of investment for people all along. From ease to flexibility and various options, FD is a boon to investors of all age groups and income levels. While bank FD is governed by each bank’s assets and liabilities situation, company FD pay higher interest than bank FD. Bajaj Finance FD offers secure and stable growth for your savings. It is one of the best investment options for investors across all categories due to following reasons:

  • High Interest Rates - The interest rate offered is one of the highest in the Indian financial market. It is usually 1-2% higher than bank FD at the same tenor. Bajaj Finance FD offers 8.35% interest rate for 3-5 years. FD interest rate for senior citizens is 0.25% higher than regular FD interest rate. Also, you can earn an additional 0.10% on renewals.
  • Credit Rating - You can be assured with the stability and safety of your investments as it is rated MAAA (stable) by ICRA and FAAA/Stable by CRISIL.
  • Cumulative and non-cumulative options - You can choose from cumulative or non-cumulative interest payout, based on your requirements. The cumulative option allows further investment of interest along with the principal and gain higher interest. This is a great option for building a corpus for the long term. The non-cumulative option allows fixed interval payouts – monthly, quarterly or annually which can help meet expenses.
  • Ease of laddering - Bajaj Finance FD can be utilized with laddering – you can make multiple FDs at fixed intervals to achieve maturity in a continuous stream. You can choose tenor between 12 months to 60 months tenor to suit your needs.
  • Minimum investment amount - You can start with an amount as low Rs. 25,000 without affecting your budget.
  • Loan against FD - You can avail a loan against your FD offering liquidity and ensuring you have money during emergencies.

Annual rate of interest valid for deposits up to Rs.5 crore (w.e.f 05 May 2020)

Tenor in Months Minimum deposit (in Rs.) Cumulative Non-Cumulative
Monthly Quarterly Half Yearly Annual
12 – 23 25,000 7.40% 7.16% 7.20% 7.27% 7.40%
24 – 35 7.45% 7.21% 7.25% 7.32% 7.45%
36 - 47 7.50% 7.25% 7.30% 7.36% 7.50%
48 - 60 7.60% 7.35% 7.39% 7.46% 7.60%

Rate benefits basis customer category (w.e.f. 05 May 2020):

+ 0.25% for senior citizens

+ 0.10% for Bajaj Group employees, Bajaj Finance Ltd customers and Bajaj Allianz Life Insurance existing policyholders

Renewal:

+0.10% over and above the rate of interest at which the deposit is booked

 

In addition to the special tenor scheme, existing customers or Bajaj Finserv employees can benefit from 0.10% higher interest rates, and senior citizens can get 0.25% higher interest rates on their Fixed Deposit.

 

How to Invest?

This is one of the most basic questions that people ask along with where to invest. The answer to both these questions depends on your earning and spending. First, analyse your financial goals and how much money you require in each time frame. A certain portion of your portfolio should always be in a stable and safe investment option like Fixed Deposit. You can determine the amount and invest per each time frame.

Now you make an online investment in Fixed Deposit online from the comfort of your home. Research a bit to find out what are the best available options for you and start investing. All the best!

Do you plan to invest in FD? Find out how to open an FD account.

For more information on investment ideas, how to invest and various requirements, please get in touch with us.

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