The best low-risk high return investments plan for beginners
Posted: Feb 11, 2019
Investments are considered one of the best sources to increase wealth. Low-risk high return investments plan is a must for decent financial planning. An individual needs to consider the financial health of the respective institution where they seek to invest their funds.
Investments plans are usually of different types and cater to the respective needs of the individuals. Investors, in general, prefer low-risk high return investments plan for their financial needs.
Some of the Investments Plan for Beginners
Fixed Deposit (FD) - A Fixed Deposit scheme is the best investment plan that any beginner can invest their funds in and gain high returns. Fixed Deposits generally provide a high Return on Investment (ROI) along with assured returns to the account holder. Fixed Deposits provides more interest rates to senior citizens and even acts as collateral for obtaining loans. The tenor generally provided under this investment scheme is 1 week to 10 years.
Mutual Funds- Mutual funds are a great place to start an investment for novice investors. This investment plan is suitable for any individual seeking low to moderate risk factor along with high returns. A mutual fund has a lot of liquidity and is ideal for individuals who are looking for a diverse portfolio to begin their investments.
Public Provident Fund (PPF) - Public Provident Funds are good investment plans, to begin with as they are suitable for both salaried individuals and self-employed people. Public Provident Funds are also subject to income tax exemptions under Section-80C. This investment plan is suitable for individuals who are looking to park their savings for a lock-in period of 15 years.
How to choose the best Investment Plan?
The best investment plan differs from investors in general. It is advisory to select an investment plan which caters to the financial requirements of individuals. Certain aspects that need to be considered before choosing an investment plan such as
Ratings- Ratings associated with an investment plan is of crucial importance as it specifies the credit eligibility of an investment plan. An individual is required to check the ratings provided by the respective bodies to the investment plan to be opted. For Ex- In case of Fixed Deposits, an individual should check the credit ratings provided by ICRA and CRISIL to know about the credit risk associated with the FD scheme.
Tax exemptions- Certain investment schemes provide tax exemptions in their clause. Individuals are requested to check whether the investment plan to be opted provides for tax deductions. For example- Fixed Deposits who provide an interest below Rs 10,000/- are subject to income tax act exemptions under Form no. 15G.
Initial deposits- Check the amount which may be required to open an account under the respective investment scheme. All investment plans tend to have a minimum deposit that needs to be paid for opening the scheme. For instance, for Fixed Deposits, the minimum initial deposit can be Rs 25,000/- or more depending on the financial institution.
Senior Citizen Perks- Some investment scheme provides additional benefits to senior citizens and retirees. This point needs to be taken into consideration before choosing an investment plan. For example, in Fixed Deposits, senior citizen tends to get higher Fixed Deposit rates as compared to the regular FD schemes.
Renewal benefits- Some investment plans provide additional benefits to the account holder at renewals of the investment scheme. This helps individuals in getting optimum returns. For example, FD on renewals provides additional interest higher than the interest provided in the previous scheme under the same. Provident funds also provide a higher interest rate when renewed after 15 year lock-in period.
Benefits Offered by Investing in Bajaj Finance
Bajaj Finance is one of the fastest growing Non-Banking Financial Companies (NBFCs). The company offers a Fixed Deposit scheme to individuals who wish to grow their wealth in a safe avenue. The features provide under this scheme are:
Flexible tenors ranging from 12-60 months under this scheme.
The company is accredited with ICRA ranking of MAAA and CRISIL ranking of FAAA in India. This ensures the high credibility of the company.
The company provides 200+ branches in 200 cities spread across India for quick accessibility.
This scheme provides senior citizen applicants with a 0.35% higher interest rate as compared to the regular FD scheme.
The FD interest rate under this scheme ranges from 8.75% to 9.10% per annum.
Aman Khanna is an experienced financial advisor. He has written numerous pieces on various investment topics like Mutual Funds, FD, RD and many more.