Investments play a crucial role in securing your future financial well-being and meeting current or long-term needs. There are numerous investment options for salaried persons and self-employed individuals.
However, choosing the right and best instrument is essential to ensure that you get your money’s worth. Given that salaried individuals have a fixed income and can generally endure low volatility, the investment options need to align with these factors.
Fortunately for these individuals, the best investment plans for salaried persons cater to these needs and more. Read on to find the top investment options for salaried employees.
Mutual funds are one of the most common investment options for low-salaried persons who are starting out in their careers. This includes those who earn a substantial income as well. The ideal way to go about investing in them is via SIPs.
SIPs allow you to invest every month, depending on your investment capacity. Some funds even have a minimum investment requirement of ₹100, enabling you to leverage your equity investments and earn high returns.
You can go for large-cap or small-cap funds, as well as other categories, based on your goals. Generally, SIPs generate good returns in the long term, as they average out short-term volatility and losses.
Fixed deposits are one of the most traditional investment ideas for salaried persons, especially those with a low-risk appetite. These deposits come with tenors ranging from 7 days to 10 years, allowing you to invest for varying needs.
The interest rates of fixed deposits have risen in the past few years, making them an excellent choice to secure good, stable returns. You can invest in FDs periodically, like mutual funds, to better suit your investment capacity and goals. This is via a Systematic Deposit Plan (SDP) offered by some banks and NBFCs.
Post office schemes are among the safest investment ideas for salaried persons. From term deposits to recurring deposits, there are multiple schemes to choose from. These schemes also come with varying tenors, enabling you to invest for different goals.
These government-backed schemes additionally offer tax benefits, just like Public Provident Funds (PPFs). The tax benefits are provided under Section 80C of the Income Tax Act, 1961, with deductions of up to ₹1.5 Lakhs.
This is one of the best investment options for salaried persons who are looking to invest for their retirement. It is regulated by the Pension Fund Regulatory and Development Authority (PFRDA), under the jurisdiction of the Ministry of Finance and the Government of India.
NPS ensures the security of your investment and returns. Moreover, the minimum investment requirements of NPS are actually low, starting at just ₹500 (monthly) and ₹6,000 (annually). In addition to this, it comes with tax benefits at the time of investment and maturity.
PPF is also one of the many popular investment options for salaried persons primarily due to its tax benefits and returns. Through it, you can make secure contributions for your retirement since it's a government-backed scheme.
The tenor for PPF is 15 years (lock-in period) with tax benefits of up to ₹1.5 Lakhs. However, unlike PPF, the Employee Provident Fund (EPF) is a tool that allows you and your employer to jointly contribute a part of your salary. This is also a retirement savings tool.
Now that you know the top investment options for salaried persons, remember to choose one that fits your current and future needs. Also consider other investment avenues like real estate, physical or digital gold, and even equity.
Since every investment carries some risk, ensure that your tolerance threshold and the investments’ associated risks align. On Bajaj Markets, you can easily and digitally invest in some of the abovementioned investment avenues. Additionally, access tools that help optimize your investments and maximize your returns.
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Salaried individuals have various investment options based on their financial goals, risk tolerance, and investment horizon. Some of the common investment avenues include Employee Provident Funds (EPF), Public Provident Funds (PPF), equity mutual funds, fixed deposits, National Pension Schemes (NPS), Post Office Schemes (POS), and Systematic Investment Plans (SIPs), among others.
To choose the best investment option for salaried persons, factor in your investment goals, risk tolerance, and capacity. Use online tools to understand your returns and maturity value to see if the available option aligns with your needs.
Investing 50% of your salary could be a commendable goal, but whether it is feasible depends on your individual financial circumstances and budgeting capability. When choosing to invest, you can consider your monthly expenses, debt obligations, and other financial goals.
Building wealth and achieving financial goals is a gradual process. Consistency and discipline in saving and investing are essential for long-term financial success. Adjusting your strategy based on various factors such as budgeting, debt management, tax, and retirement planning can help in goal-based investing.