This article will drive you through the 5 Best Investment Options for Middle Income People In India.
PPF accounts | Best Investment Options For Middle Income People In India
PPF account requires you to invest a minimum of Rs.500 for a whole financial year. You can put up to Rs.1 lakh during 1 financial year which can be done at once or in installments. The amount & number of installments can be changed. However, it can be changed only when the installments don’t exceed more than 12 in a financial year. The bank will terminate your account if you fail to deposit the minimum amount. However, interest will continue to accrue. The bank will regularize your account again after you provide the bank with the overall prescribed default fee.
ELSS FUNDS | Best Investment Options For Middle Income People In India
Section 80C suggests that Equity-linked saving schemes can produce good returns over the long term. In the last 5 years, ELSS FUNDS has generated good wealth for investors. It provided 17.5% of average returns in the past 5 years. It has potential for greater returns and greater flexibility. All these features make this option a viable tax-saving avenue for the middle income people in India.
The ELSS funds are diverse unlike other open-ended equity funds. The lock-in phase saves you from redemption pressure from the investors. Hence, you can freely invest in shares & hold them shares for longer periods.
In the last few years, the ELSS category consistently outperformed the diversified equity funds of midcap & large sub-category
Small tip- Don’t invest in a lump sum amount. Split your investments in the ELSS funds into 3 SIPs. You can begin from the month of January till March.
Savings accounts | Best Investment Options For Middle Income People In India
Savings accounts give greater returns than checking accounts. However, savings accounts offer lower rate of returns. Savings account is a secure place to preserve your money temporarily. It can also be used in parallel with your checking account to manage your basic personal finances.
Certificates of Deposit | Best Investment Options For Middle Income People In India
Certificates of Deposit are also known in short as CDs. CDs offer greater rates of return for your invested money. However, if you withdraw money before the maturity period then they charge a penalty. Certificates of Deposit are safe investment options & are FDIC insured
Treasury Securities | Best Investment Options For Middle Income People In India
Treasury securities & bonds offer modest returns & are highly liquid which is convenient for short-term storage purpose.