a. Good future for our kids Education
b. Retirement money
c. Start saving for Daughter's wedding
d. House of our own
e. Vehicle of our own - a car indeed. Bike is a household stuff now
For all the above, there is a common things to do: INVEST.
So lets discuss about Investments. Some of the above can be regarded as short term profits while other like kids, marriage - remarriage :) can be considered long term goals.
The first step towards investing in India is to clearly evaluate individual requirements for cash, the capacity to invest without being frugal, guts to take calculated risks
Some of the select few Investment Options in India are like:
Real Estate : HOT HOT HOT. Its booming like hell these days.
Buy land, apartment or a independent house....its all worth. how to buy, where to buy and why to buy - lets discuss that separately.
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Mutual Funds: Big banks like SBI, ICICI, HDFC, Kotak....collect money from investors like us & then they invest it on the share market. here we are sort of isolated from all the fancy stuff...the big companies do all the calculations...experience to increase the value of the money.
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Gold Deposit Scheme: its a 100% safe investment as they are regulated by none other than SBI.
We can deposit invest minimum of 200 gm in exchange for gold bonds & hold a tariff free rate of interest of 3% - 4% on the basis of the period of the bond varying with a lock in period of 3 to 7 years. I have not invested in it though :(
Here the return can be got by cash or by gold :)
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Bank Fixed Deposits (FD) - SAFEST but SLOW return.
These days, the banks are trying to attract investors with many many goodies for opening a FD... FD generally accrues 8.5% of yearly profits, depending on the bank's tenure and guidelines,
However I would suggest depositing in a Government or Nationalised bank rather than some unpopular private bank which promises higher rate of interest. Considering the Nationalised banks, it is the most sought after and safe investment alternative.
The minimum tenure of FD is 15 days and maximum tenure is 5 years and above. Senior citizens are entitled for exclusive rate of interest on Fixed Deposits.
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LIC policies: I believe IRDA has made some regulation where by LIC is in no way different from ICICI Prudential or HDFC or....
But, LIC has been in insurance & has so much of cash flow that we still can trust it with a blindfold.
Some of the features apart from being an investment is that it risk free - from the volatile stock exchange..
Today we haveSome of the popular Insurance policies like Housing, Life, Health & Automobile policies.
There are dozens of companies but I would certainly prefer LIC, SBI Life among these ICICI Prudential, Bajaj Allianz, Birla Sunlife, HDFC Standard Life, Reliance Life, Max NewYork Life, Metlife, Tata AIG, Kotak Mahindra Life, ING Life Insurance, etc.
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Stock Market: Its RISKY though can offer better / higher profits. Got to follow the pulse of market wisely so that you dont burn your fingers... Better stay away if you are a heart patient or have a weak heart as you got to take lots of risk.
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NSC : National Saving Certificate (NSC) is subsidized & the money locked for 6 years at an interest rate of 8%. The best part of NSC is, investment in this category falls under Section 80C of IT Act, so the profit accrued by you can be valid for tax deduction up to Rs 1, 00,000
So go for this investment when you are sure that you DONOT need this money for that may years...
You can dump as much money as you would like to...as there are no upper limit in this investment option National Saving Certificate .
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Public Provident Fund (PPF) : Just like NSC, Public Provident Fund (PPF) can also be 100% trustworty as it is give by Indian Govt.
But here the interest rate is 8% which is evaluated yearly with a lock in tenure of maximum 15 years.
Here there is an upper ceiling to invest - i think around 70K. Its pretty easy to open a PPF at our post office here too, the investment falls under Section 80C of IT Act so we could gain income tax deduction of up to Rs 1, 00,000.
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Equity: they too are little risky that's what i know.
Readers please contribute
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