Best way to invest your money

                                      

                            Best way to invest your money

Hello friends Once again am here with the new and very interesting topic where should you invest you money, so 

that you can enjoy safe and maximum returns.

      Before start this topic one thing I would like to clear that there is no such kind of investment option available in 

market which doubles your money in fraction of seconds or in one night. For good returns you have to engage your

 money in right direction and wait for long period like 5yrs, 10yrs, 15 yrs, 20 yrs like that.

Savings are very important part of our life. We should save at least 20% part of our salary, for future. Because we 

know future is uncertain. Lot’s of people not believe in saving. And when they require some amount of money then

 they run behind the loan. I don’t think taking personal loan is wise decision because bank will not provide 

anything free of cost they charge heavy interest rate from you.  So at right time with the help of best savings if you 

store sufficient amount in your bucket then in case of emergency this fund will help you.

There are lots of investment options available in market. Sometime investor get confuse invest own hard earn money in wrong product.  Before invest anywhere some key points you have to keep in your mind.     

• ·         Do you want fixed return
• ·         For how much period you can hold your money in particular investment tool
• ·         Do you want some tax benefit also
• ·         What’s your budget
• ·         Are you going to investing in Bank or Nbfc or it’s some chit fund type company

Am not saying this product is good and that one is not. No it’s not like that. All saving product having its own value. It’s depends on your need.

So let’s start one by one all saving’s product.

1.       Recurring Deposit.    This is my all-time favourite product. Because only Rs.100 is minimum amount to invest 

       here. And liquidity is also available here. Means at any time you can withdraw your money. This is pure bank 

p   product so through saving account you can place a request for your Recurring Deposit. It’s depending through bank to 

bbank. In all private banks you can place the request for RD through your mobile app or bank 

websites. But in Government bank if net banking or mobile banking facility is not available in your 

savings or current account then with the single visit of your branch you can invest your money in Recurring Deposit. The rate of interest is depends on tenure. Normally it’s start from 4 to 5 per and its goes to 8 per. Group of senior citizens can enjoy 0.5 per extra returns on Recurring Deposits.

2.       Fixed Deposit.     Fixed Deposit is my all-time favourite product. Because like Recurring Deposit returns are fixed here. The minimum amount is only Rs,10000. The is no lock in period in Fixed Deposit but the condition is it should not 5yrs tax saving FD. As we already cover this point in my last blog that in tax saving FD you have to wait for at least 5yrs to withdraw your money. Again like Recurring Deposit rate of interest is depending on tenure here.  Different rate is applicable for different tenures.

3.       Public Provident Fund (PPF)   In simple language we can say PPF is upgrade version of Recurring Deposit. The minimum amount to invest in PPF is only Rs.500. But like Recurring Deposit liquidity is not available in PPF. Because there is lock in period is 15 yrs. But best part is PPF is cover under 80C. Because this is bank product so you have to link your PPF account to your saving account. Every month you can invest desire amount in PPF. And the end of maturity you will get fixed return. Under section 1010D maturity amount is tax free here.

4.       Mutual FUNDS.     The minimum amount of invest in mutual fund is Rs.500 to Rs.1000. And there is no limit of maximum one. If you want you can invest lumsum amount also in mutual fund. But I suggest mutual fund in log run not in short run. Because like FD & Rd the returns are not fixed here. Because you going to invest your money in market through mutual fund. And we know market is volatile so your returns are depending on market situations. If you want to withdraw your money before one year then you can but 1% loading charge is applicable on your fund value.

a.       How mutual fund work    every mutual fund companies having some fund managers. They have responsibility to manage the investor’s fund. Suppose if you invest Rs.100 in a month in mutual fund. Then they divide this Rs.100 in 100 companies. Means Rs.1 in each company. So the concept is in a single time period all companies will not sunk. Some companies perform well some not. Then in this case these performing companies will generate revenue for you.

b.       How to choose mutual fund.   Before investing in mutual fund some homework should done from you side. On the website www.moneycontrol.com you can see the history of all mutual funds. What was their performance in last five years? Who is the fund manager for that particular fund?

c.        Types of fund     there are two types of fund first is equity and second one is debt. As I earlier discuss this topic in my last blog. That equity is best for young person. And debit is best for 40 yrs. and above. Because equity is risky tool so young blood having lots of time to invest in equity fund. And minimize his/her risk. But this point is not applicable for old person. Because he can’t take so much risk. So it’s better if they invest in debit fund.

d.       What will happen if company gets shut down See this is not chit fund companies. They register with SEBI. SEBI is government organization who gives license to such kind of company. And obtaining license from such SEBI is not a child game. You have to follow so many rules & regulation. So don’t think about this. My only suggestion is invest your money in right fund. Do some research works then invest? And monitor you fund value on daily basis.

5.       Life insurance policies.     Life insurance policies are also good option to invest your hard earn money. But I will skip this topic here. Because this is very important and lengthy topic. So my next blog will be based on this particular topic. After completing blog I will mention the link here. So that you can get some basic idea about life insurance policies also.

6.       Gold    Gold is also a better option for investment. You can invest in gold according to your worth.

So this was the important point for your savings. My next blog is based on life insurance product. So I requested you please follow my link for all types of banking knowledge.