Saving money is not enough. Invest your way to greater wealth.

It's been a while since the savings-minded India started exhibiting a change in trend. As opposed to earlier, when 'saving' just meant being penny-wise, and 'savings' was referred when money was literally saved; people were now realizing that safe-keeping the savings at home wasn’t really the safest or the smartest thing to do.

As more-and-more people got educated about investments, Indian audience gradually expanded its horizon of Investments. They now understood that –– Saving & Investing, go hand-in-hand, and to be able to invest, you need to first start saving.

So how should one really go about investing?

The omnipotent mantra is – Diversification!
While investing - always diversify your funds into multiple options, to make the most of your investment corpus, while keeping the risks at a minimum.

Here's a list of some of the most popular investment options…

• Fixed Deposits
  A secure investment that earns you anything between 6% and 8.25%! If you don't wish to lock away your funds for a long duration, try the 'Laddering' approach. Laddering helps spread the investment amount across different maturities and provides liquidity to funds. Each "rung" of the ladder is an FD of a specific maturity date, and the "height" of the ladder is the difference between the shortest and the longest maturity FD.


• PPF
  The Public Provident Fund (PPF) that currently offers 8.1%, is a preferred instrument for planning and achieving long-term goals. In the last few years, besides other nationalized banks, private banks have also started offering this service. You also get to enjoy tax-free interest and withdrawals, and tax-deductible investments.


• National Pension Scheme
  The interest rates depend on the scheme chosen and vary every financial year. NPS is promoted by the Government of India and is considered to be among the best retirement plans in India. It not only offers great returns on investment but also comes with a lot of flexibilities that help in choosing the investment options.


• Post Office Saving Schemes
  This is said to be one of the oldest way to invest your money and enjoy guaranteed returns with the least amount of risk. The offerings include RDs, Time Deposits, Monthly Income Schemes, National Savings Certificates, Kisan Vikas Patra, and Sukanya Samriddhi Accounts.

Other than these, here's a list of some of the investment options that fall outside the safety net of guaranteed returns…

• Mutual Funds
  Two popular funds here are – Debt & Equity! Debt Mutual Funds mainly invest in a mix of debt or fixed income securities such as Government Securities, Corporate Bonds, etc., while Equity Funds typically invest in stocks of companies. For beginners, it will be a good idea to start off with an SIP (Systematic Investment Plan) of a small amount and gradually increase the investment.


• Direct Equity
  This refers to a direct investment in a business enterprise, in against for equity in the enterprise. The returns from equity have been more rewarding than all other asset class. But direct equity investing is also considered to be a risky proposition. So it is advised to get involved only after doing the necessary research about the company’s background, user base, returns over the years, and any other information that you can find.


• Real Estate Investments
  In a country like India, where land is limited and the population is booming, owning a property is a dream for the most. But when you do invest in real estate, make sure to look for a location that is developing or is developed, or else, it would take a lot of time before you’d be able to monetize your investment.

That said - before you make your choice, do ask “yourself” these questions...

1. What is my objective - is it Short term or Long term?
2. What is the quantum of risk that I am willing to take?
3. What is the duration of my Investment?
4. What kind of returns am I expecting?

Once you have your answers – go ahead, invest and reap rich returns!

Happy Saving. Happy Investing!