Explore the landscape of safe and low risk investment opportunities for high returns in India for 2023-2024. Discover financial strategies and secure your future with our investment guide. Make informed decisions to grow your wealth prudently in the evolving financial landscape of India.
Low Risk Safe Investments for High Returns
Investing is essential for safeguarding your future, achieving your goals, and accumulating wealth over time. High-return investing strategies might help you keep ahead of inflation. To begin investing in a high-return strategy, you must first identify your investment objectives. Here are your options:
- . Gold:
Indians are accustomed to making gold investments. However, the majority of this would be in the form of jewelry, which can sometimes cause more harm than good. The biggest issue is that jewelry is extremely expensive on its own. Furthermore, there are normally six to fourteen percent ‘making costs’ applicable; they can go up to twenty-five percent as well. Investing in gold coins or paper gold might be a better answer for this. This is much more cost-effective and has no hidden fees. Sovereign gold bonds and gold mutual funds are two other options. Because gold is a commodity that is easily resalable, it is an excellent investment.
- Real Estate
Real estate investing is another prominent investment choice in India. Though it requires a significant investment, the profits are enormous. You can earn money by selling it or renting it out on a monthly basis. However, when buying or selling, make sure to factor in any associated fees such as registration fees, property taxes, and so on. It can be thought of as a solid long-term investment alternative.
- Bonds
Businesses and governments, like individuals, need money to develop and thrive. They sell bonds to raise money for their company. These bonds are available with a fixed interest rate and term. It is seen as a low-risk investment option in India, particularly when government-backed.
- ELSS
Equities-Linked Savings Plans invest assets in risky equities stocks in order to generate large returns. Furthermore, under the prior tax regime, ELSS was a dual benefit scheme that allowed you to earn high returns while saving up to Rs. 1.5 lakhs u/s 80 (C).
- Savings plans
Saving programs, as the name implies, assist you in saving your monthly income over time, resulting in a large corpus. The government, banks, or financial entities back these. The savings plan has a lock-in term and encourages you to save on a regular basis. They are low-risk, long-term investment possibilities that do not demand a large initial commitment.
Employee Provident Fund (EPF), National Pension Scheme (NPS), National Savings Certificate (NSC), Post Office Savings Account, Senior Citizen Savings Scheme (SCSS), and other popular savings schemes are available in India.
- PPF (Public Provident Fund):
The PPF is a long-term investment plan with a 15-year maturity. Its compounding, tax-free interest rate guarantees large returns. However, the government reviews this rate on a quarterly basis. PPFs provide guaranteed returns because the principal amount and interest earned are secured by a governmental guarantee.
- ULIPs
Insurance firms provide Unit Linked Insurance Plans (ULIPs). A portion of the money is placed in stocks or bonds, while the remainder is placed in life insurance. Overall, it invests in equities and debt markets while providing investor protection. In addition, it provides tax savings, protection, and returns. However, because it incorporates equity, there is some risk involved. Learn about them here, along with all you need to know about ULIPs and the five top ULIP plans to guarantee your future.
- REITs
Real Estate Investment Trust (REIT) is a type of investment that is similar to mutual funds in that participants pool their money and REIT businesses manage it. They put the money into principal real estate and mortgages. They make money via rental income, and investors receive a portion of the profits in the form of dividends.
- Stocks
Stocks are one of the most popular investing alternatives in India. Although, a risky asset, investing in Nifty 50 Index has given positive returns over the period of 5-10 years. It is preferred by investors seeking long-term investments with high returns. However, it is crucial to recognize that investing in stocks brings risk, and you should only invest if you have a thorough understanding of the market. Before investing in stocks, you should conduct thorough study as an investor.
There are various types of stocks, such as growth stocks, value stocks, and so on. All of these stocks can be filtered based on essential factors such as market capitalization, net profit, and so on. You must grasp the stock sector, management, market environment, and so forth.
- Peer to peer lending:
Peer-to-peer (P2P) lending is a type of financial technology that allows individuals to lend or borrow money from one another without the use of a bank. P2P lending services such as Monexo connect borrowers with investors directly. The website facilitates transactions and establishes the fees and conditions. Individual investors who want a higher return on their cash investments than a bank savings account or certificate of deposit are P2P lenders. P2P borrowers are looking for a better alternative to traditional banks or a reduced interest rate. P2P loan default rates are substantially greater than in traditional finance. Investors might expect annual returns of up to 13%.
In Conclusion
A wise strategy to invest is to properly comprehend the many investment possibilities available in the market. However, you should always keep your savings and investments separate because they serve different purposes. Finally, with the help of a professional and prior knowledge of your risk tolerance and goals, selecting the ideal investment option becomes simple.
Although, this post discusses some of the preferred investment options by Indians, but for investment decisions, it is crucial to consult with your financial advisor.
