Money is certainly one of the most important things in each of our lives. It is the aim of getting money because of which we do so much hard work. And we do all this to make our future secure, isn’t it? However, if you only earn money, will it be enough for securing your future? Well, gone are the days when people would only save money. These days, people believe in investing their hard-earned money and seeing their money grow and bear fruits.
Why should you invest?
Many people still think that saving is a better option and investing money has risks. Seeing the inflation rate, saving may not always support you the way you want. If you want to grow your wealth, you must make investments of your money. The more risks you take in investments, the higher are your chances of getting the returns. Investing money means you are not keeping your money idle, rather making it work hard to give you the best possible returns.
There are several investment plans that you can consider. Here are some of the long-term investment plans that you can take a look at.
Direct Equity, also called a stock investment by many people, is one of the most sought-after investment options of investors. As you purchase shares of a company, you in a way get ownership in the company. Long-term stock investments may even help you in capital appreciation. Investing in stocks will help you get attractive returns; however, you need to know that there are risks associated with this type of investment option.
Investing in mutual funds is yet another option of investment that brings the best result. A mutual fund consists of money that is collected from several investors like you. These investors share the common investment objective. Once the money is collected, it is then invested in several instruments like bonds, stocks, money market, to name a few. It is one of the most flexible investment options as it gives you the scope to start or even stop your investment into it, at your convenience. The returns are moderate, and the risk is way lesser than equity investment.
Public Provident Fund (PPF)
Public Provident Fund or PPF is a savings scheme provided by the Government of India. It helps in mobilizing small savings. Individuals who put their money in PPF can enjoy a secure life after they retire from their job. The lock-in period of this scheme is 15 years. This investment scheme is eligible for tax deductions under Section 80C of the Income Tax Act, 1961. There is a risk associated with this scheme.
Employee Provident Fund (EPF)
Employee Provident Fund or EPF is a retirement-oriented investment scheme that is designed especially for salaried employees. Under this investment scheme, a percentage of the monthly salary of the employees is deducted. The employer contributes an equal amount. Just like PPF, EPF is also eligible for a tax deduction. The final amount that you will receive after the maturity of this scheme will also be tax-free.
National Pension System (NPS)
National Pension System or NPS is a retirement pension scheme which is offered by the Government of India. The money you put into this scheme will give you a monthly return after your retirement. The lock-in period of this scheme is till retirement and is mandatory. If you want, you can even make partial withdrawal post-retirement. The money you put in NPS is eligible for a tax deduction.
Sukanya Samriddhi Account (SSA)
This is also an investment scheme that is backed by the Government of India. This scheme is especially made for the girl child. Parents of a girl child can open an account under this scheme until the age of 10 years of the child. From INR 250 to INR 1,50,000 lakhs, any amount can be put into this account in a year, for 14 years. The account matures once the girl child completed 21 years of age. The interest rate on this scheme is 7.6%. The money claimed under SSA is eligible for tax deduction under Section 80C of the Income Tax Act, 1961.
Term Insurance Policy
You can buy a term insurance policy and make a yearly payment. The premiums you pay are decided to depend upon your age and pre-existing illnesses. A term insurance plan will be helpful for your family on your sudden demise, within the tenure of the policy. This can secure the future of your family when you are not there.
All of these investment options are excellent choices. You can get to know about these even more by visiting the IIFL website. Once you understand each of them thoroughly, you can make a conscious decision.