Best Investment Options for the Middle-class Family in India

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If you are a middle-class man in India, you have a certain fixed income and lots of responsibilities to take care of. Even if you have a lot of wishes, not all of them get fulfilled. And ever since the outbreak of COVID-19, middle-class people have been hit badly. The pay cuts and job loss in the past one and a half years have made the situation of this class of people really bad and challenging. Well, situations in life can take any shape at any time. This is why it is better to take the necessary steps beforehand. One of the most important steps is buying a term insurance plan. The amount of sum assured your family will get in your absence can be a great help to them. Apart from term insurance, there are also many other investment plans that you can consider.

If you want to invest your hard-earned money and get good returns, here are some investment options for the middle class that you can check out.

Savings Account

One of the best investment options for middle-class families is opening a savings account in a bank in the country. You can start the savings account with a small amount, and it will collect at least 3-4% yearly. You can call it liquid money and can withdraw it whenever you want even from your nearest ATM. Although the return you will get is not high but it is one of the safest options that you have.

Fixed Deposit (FD)

This is one of the most popular investment options opted by many middle-class people in the country. This option is offered by all the banks in India. Once you start an FD, you have to keep investing the particular amount for the tenure that you choose. Once an FD is matured, you will get the amount you have put all these years along with interest. Just like Savings Account, this is also one of the safest options that you can choose from.

SIP in Equity Mutual Funds

Systematic Investment Plans (SIP) has become a popular term in the investment market. The middle-class population has been seen taking interest in investing their money into SIP, these days. You can start a SIP for as low as INR 500 each month; however, it can be a little risky step. You can start a SIP in equity mutual funds and stick to it for at least one year to see if you are getting any profit out of it. If it is performing well in the market, you can choose a longer duration. Nevertheless, to invest in a SIP, you need a risk appetite.

Stock Market

If you are comfortable taking risks and at the same time you also want to get a high return on your investment, you can consider putting your money in the stock market. There are certainly many risks attached to the stock market but there are also higher chances of getting a very good return on the money you put.

Gold Bonds

We all have seen that our parents buy Gold on auspicious days. Buying gold has always been associated with positivity in Indian families. The returns that you will receive on investment in Gold are usually high, and this can also be a great asset. You can buy gold in the form of jewelry, bars, coins, etc. You can also purchase a Gold bond digitally; however, the return will be linked to the original gold.

Public Provident Fund

Popularly called PPF, Public Provident Fund is offered by the Government of India. It is an excellent choice for people who want a good return on their investment. The minimum amount that you can put each year is INR 500, while the maximum amount you can put is INR 1,50,000. PPF is covered under Section 80C of the Income Tax Act, 1961. You can enjoy a tax deduction of up to INR 1,50,000 a year. This means you will be able to save at least INR 46,800 in taxes. The locked-in period for a PPF account is 15 years.

These are some of the investment options that any middle-class individual can opt for. However, to get in-depth knowledge about these and even more options, you can visit the IIFL website.

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About the Author: Abhay Choubey

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