Everyone needs money at different stages in life, for which they are required to create a corpus – whether for retirement funds, a child’s schooling, or a marriage. When looking into different strategies to accumulate money, one prefers to look into the best investment plan where your money increases while you relax.
Unfortunately, there is no easy fix because several best investment plans are available. However, one of the best possibilities is the simplicity of the investing programs provided by most life insurance carriers.
Types of Plans
Unit-Linked Insurance Plan: A portion of the premiums are used for insurance, and the remaining portion is invested in the stock market. Depending on the investor, money can be invested in bonds, equity, loans, market funds, or a hybrid.
- Endowment Plan: The classic insurance product with an investment possibility is an endowment plan. This investment plan combines investment and protection. Funds are not market-linked.
- Cash-Back Program: This best investment plan combines insurance and investment. It gives regular returns as a percentage of the guaranteed total and covers the risk of untimely demise.
- Regular Deposit: The interest rate on a fixed deposit, also known as a term deposit, stays the same for the duration of the specified term.
- Public Provident Fund: It has an annual interest rate of 7.6% that is added up, and you can invest as little as Rs. 500 and as much as Rs. 1,50,000.
- National Saving Certificate: Government-backed NSC is the best investment plan for tax-saving. Any Indian citizen may acquire it from a post office within the nation.
- National Pension Scheme: Investors can contribute as much as they want to this pension plan, or they can take a lump sum of a portion of the corpus and invest the rest in annuities to build up a large amount of money for when they retire.
- Mutual Funds: It is one of the best investment plans run by a seasoned Asset Management Company (AMC), which pools the money from all its investors and makes investments in stocks, bonds, and other assets.
- Tax Saving Mutual Funds: The sole mutual fund option that provides tax advantages is Equity-linked Savings Scheme (ELSS). With a minimum lock-in duration of 3 years and a minimum investment value of Rs. 500, it is a long-term equity mutual fund investment. Use a savings calculator to know how much you should put away each month to reach a particular savings target.
- Bonds are debt investment strategies that let investors lend money to a borrower, such as a company or the government, at a certain interest rate and for a predetermined length of time.
Feature of Best Investment Plan
Are you trying to find a sound investment strategy? The following are some key components that the best investment plan has to have:
- Risk-averse: A sound investing strategy shouldn’t subject you to more risk than you can manage or what is required to meet your goals. Your strategy for investing should give you the returns you need to meet your needs while exposing you to as little risk as possible.
- Simple: A solid investment strategy shouldn’t make your life more complicated by adding layers of complication. Anytime you desire, you should be able to analyze your investing strategy and evaluate its success quickly.
- Transparency: A sound investing strategy must be open to the public. In other words, you need to understand the true purpose of the investment strategy. In addition, you must understand each component completely to understand how it functions and what you can do to benefit the most.
- Easy to Manage: An effective investing strategy must be simple to implement. It should let you make the right changes when you need to without making things more complicated.
- Tax Effectiveness: An effective investing strategy must be tax effective. Simply put, a successful investment strategy must maximize the quality of your investment strategy and the portfolio generated while minimizing your taxes.
To sum up
Putting your money into any of the best investment plans that could give you a higher return comes with some risks. So before investing, it’s a good idea to research the risks that might come with the product.