In today’s world, where women are pursuing high powered careers and playing significant roles in the workforce, they must give a thought over achieving financial independence as well. It is very important to have a good idea of the right investment opportunities available. Being a woman investing also makes you financially independent. Gone are the days when a woman is dependent on her father or husband. This thought of being self-dependent can be worked upon by making the right steps toward investment.
Indian market is flooded with investment plans, from fixed returns to mutual funds, there are options galore which can help one in increasing wealth. But the most important factor is you should know where to invest based on your risk appetite, age, and financial goal. According to experts, there are various options which help you with wealth generation, the best are listed below for your information.
Best Financial Instruments for Indian Women
1. Fixed Deposits (FDs)
FDs are considered as the first choice of investment by everyone. This is because fixed deposits are a fixed-income instrument that guarantees return without any involvement of risk. FDs are one of the best saving cum investment options which you can easily avail in public or private sector banks. The tenure and amount would be chosen by you. The rate of interest would vary from bank-to-bank. There are some banks, which give attractive rates of interest for women. There are certain banks with women-centric account benefits too. The best thing about FDs is that you can break it anytime and the amount can be withdrawn before the maturity date when you require money. It should be noted that if an FD is broken before the maturity date then it’ll affect the interest earned on the principal amount. So, just bear this in mind before breaking an FD.
2. Recurring Deposits (RDs)
Recurring Deposit is the simplest and most convenient investment option available in the market. Unlike FDs, where one must invest a lump sum amount, RDs allow you to save a fixed sum every month and earn an interest income on the same. This regular saving will also inculcate a habit of savings which will be proven beneficial when in need of funds. Sometimes these small amounts can give a big contribution in times of need. RDs do not require a huge amount of money at one go. The amount to be deposited and the tenure of the investment will be decided at the time of opening the RDs. An RD is safe and secure and will be returned along with the interest at the end of the tenure. RD is the best and safe option to invest, especially, if you’re planning for short term investments.
3. Mutual Funds
Mutual funds have become one of the most popular investment options. When you invest in mutual funds, your fund is managed by fund experts, who are highly trained and qualified with the knowledge of the equity market. Investment in mutual funds gives a balanced portfolio with equity and debt schemes with a much higher return. Well, if you are planning for any long term goals, then you can make your choices into an equity fund as equity funds give higher returns.
There is a vast option of mutual funds offered by banks and financial institutions. You can choose according to your requirements or goals. Mutual funds also provide you with a choice to either make a lump-sum investment or you can go for SIP (Systematic Investment Plan) similar to RDs, wherein a specific amount is invested every month. SIPs can help you prevent huge losses. It’ll minimise the loss and maximise returns on investment. Though mutual funds are subjected to market risk, a good fund choice can help you earn substantial wealth over a period of time.
4. Public Provident Fund (PPF)
The PPF scheme is one of the popular investment schemes in the Indian market. This scheme has a lock-in period of 15 years and gives an attractive interest of 8%. The annual investment amount of PPF rages from Rs 500 to Rs 1,50,000. After competition of 5 years with the investment, you can withdraw 50% of the funds from your PPF account. Moreover, this scheme gives you tax benefit too. You can also enjoy the benefits of this scheme if you are a homemaker. This annual investment would help you to save a huge amount in 15 years.
5. Employees’ Provident Fund (EPF)
For the working women, Employees’ Provident Fund is one of the best investment to avail the tax benefits and gather tax-free savings. According to the Government of India, new women employees will have to contribute only 8% instead of 12% or 10% for the first three years. This would also increase their take-home pay. In addition to this, new employees coming under the ambit of EPFO would be provided with a 12 per cent contribution from the government. Under Section 80C of the Income Tax Act, the annual contribution, up to 1.5 lakh (excluding employer’s share), that you make towards the EPF account is free from tax. Moreover, the tax benefits can be availed on the interest amount earned from both the employer and employee’s share.
Investing in gold is something that never loses its value. Gold is the best investment option for Indian women. There are numerous banks and MMTC authorised dealers selling certified gold coins. Dividing your investment into few grams will serve two purposes: first, it’ll never overburden your pocket and second, at the time of need the amount you’ll get from selling these grams will make your purpose served. The price of gold is never fixed and this makes it the safest investment in the long term. You can start with as little as a 5-gram gold coin every year and further increase the investment to 50 grams in 10 years and 100 grams in 20 years.