Where to invest Rs 5000 to get better returns…!!
Financial Planning is the crucial aspect of everyone’s life. It’s better for an individual to plan their finances earlier. A plan will act as a guide to you through your financial journey and even protect your investment from any kind of domestic and global upheavals, which may dent your investment. At the macro level, planning affects every aspect of personal finance, whether its financial goal or the saving. Your spending habits determine, whether you will have a better financial future or live your whole life on the edge. A plan is a simple way of listing all your needs and wants and deploying your money in the right avenues, so you have it when you want it.
The first step in this direction for you as an investor is to identify your goals and the amount of money, you want to invest. Then find out your risk-taking appetite and pick right instrument to invest. Most of the time young investors forget to cover the risk before investing. In India, most of the investors start investing from a very small amount, as they have apprehensions about the investment risk and return. But for a new investor, the biggest challenge is where to invest even a small amount of Rs 5000 on a regular basis for longer term. Let’s look at the some of the most probable options to invest in such small amounts with possibility of safer returns.
- Recurring Deposit:
The best way to invest in small amounts regularly is to invest in recurring deposits. It is best for the small investors, who don’t want to put their money in complex saving instrument. It provides a stable and guaranteed return.
- Investment in equity mutual fund:
Invest in equity mutual fund is a smart long-term investing plan. If an investor is aware about the capital market, then it’s one of the best options to generate long term growth. An investor can invest in small amounts through a SIP.
- Stock Market:
An investor can invest that money into the stock market. An investor can open a trading account and start investing in stocks with some direct knowledge and prior help. An investor can also take the help from many broking firms.
PPF is an investment product for small and retail investor. It has a long tenure of 15 years and the impact of compound interest is huge on the returns. Since the investment is backed by sovereign guarantee, that makes it one of the safest investments.
- National Pension Scheme:
National Pension Scheme is a tax saving option under section 80C and Section 80CCD. It’s basically a retirement saving scheme. It has a defined contribution, meaning that the pension you get depends upon the return of the NPS Fund.
- Senior Citizen Savings Scheme:
It’s one of the best schemes for the senior citizens. As the name suggests, only senior citizen and early retiree can invest in the scheme. It can be availed from a post office or by any bank above 60.
In all the above scheme, some are fixed income instrument while others are market linked schemes. An investor can choose either of them depending upon own investment style as well as financial goals.
*Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.