As the financial landscape is ever-changing, we all need to make wise investment decisions to secure long-term safety and growth. Today, any person can hardly overstate the significance of long-term investments, as they play the most crucial role in combating inflation and achieving individual financial goals.
The aim of this guide is to state the best long-term plans for Indians who are interested in wealth creation. So, let us begin without any further delay!
4 Popular Low-Risk Long-term Investment Plans You Can Make
These are some safe long-term investments with high returns in India:
Fixed Deposits
FDs are ideal for both short-term and long-term investing as they give you assured returns regardless of market downturns. Thus, you can consider investing in multiple fixed deposits to earn stable passive income at regular intervals (usually monthly, quarterly or yearly).
In addition to regular fixed deposit accounts, certain banks provide tax saver fixed deposit accounts, where you can leverage tax deductions of up to ₹1.5 lakh each year. However, they come with a lock-in period of at least 5 years.
Finally, senior citizens have an added advantage. They typically receive an additional 0.50% interest on regular fixed deposits with banks or post office branches.
Public Provident Fund (PPF)
It is a widely popular investment instrument among long-term investors. The PPF was launched by the National Savings Institute of the Ministry of Finance in 1968. Its primary objective to date surrounds providing reasonable returns on small systematic investments besides offering tax benefits.
When you open a PPF account, you will have to lock your money in for 15 years. It is a perfect opportunity for risk-averse investors who get attractive interest earnings over a prolonged period. At present, the PPF interest rate is fixed at 7.1%, with a minimum annual contribution of only ₹500.
National Pension Scheme (NPS)
If you are searching for the best long-term plans for retirement planning then the NPS would be an ideal opportunity to build a substantial corpus. This government-backed savings scheme offers highly professional fund management, enabling you to enjoy the maximum possible security while making diverse investment choices.
Further, you can take advantage of the default auto-choice option under NPS. It allows you to automatically adjust the proportion of investment allocation to different asset classes based on your age. This strategy is well-suited to investors who have limited knowledge but still desire the return benefits of equities, government bonds and other alternative investment funds.
ULIPs
ULIPs are versatile investment tools that allow you to tailor your investment strategy to your specific needs. With the dual benefit of life insurance coverage and market-linked investment options, ULIPs help you secure your future and your family’s well-being.
Whether you are saving for a child’s education, retirement or a major purchase, ULIPs offer a flexible and potentially rewarding solution.
Additional Long-term Investment Plans With High Returns
Apart from the investment avenues mentioned above, these are some alternative options that can potentially yield greater returns, but with a slightly elevated risk profile:
Mutual Funds (MFs)
Mutual funds represent baskets of securities which are professionally balanced from time to time by experienced fund managers. By buying mutual fund units, you can benefit from these professionals’ expertise without needing to do the time-intensive research.
As mutual funds hold different asset classes, your risk is minimised significantly. Therefore, financial experts suggest including them in your long-term investment portfolio to reap optimal results.
Direct Equity Investment
Buying shares can potentially lead to exponential gains by virtue of a company’s growth. This is because stock prices are influenced by various parameters and can grow significantly over the long term, resulting in capital appreciation.
Hence, if you can commit to active portfolio management and monitor market trends, direct equity investments are undoubtedly among the best long-term plans for seasoned investors. However, note that stock trading and investing are subject to market fluctuations. Therefore, if you attempt to make profits within a short time frame, you can potentially lose your capital.
Exchange-traded Funds (ETFs)
Exchange-traded Funds (ETFs) form a unique category of mutual funds that allow investors to invest in a diverse range of securities simultaneously. Known for their generally lower fees compared to other fund types, ETFs are particularly attractive to those seeking a cost-effective way to diversify their portfolios. This approach not only offers access to broad market exposure but also provides an efficient strategy for balancing risk and return.
Final Word:
You may choose one or more of the best long-term plans mentioned above to grow your wealth over the years. However, before starting if you feel like taking help from an expert, do not hesitate to reach out to them. They will assist you in maintaining proper balance in your portfolio and help you effortlessly achieve various financial goals.
