Investment is the process of putting aside some money to buy assets which can grow in value over a long period of time. Investing money regularly in diversified assets is a classic method of wealth creation. All you have to do is to find assets or financial instruments where you can put your hard-earned money and watch it grow over time without putting any effort.
For people from outside the financial sector or those who are doing a job, investing money in assets is the best way to create a source of passive income too. Even for housewives who have set aside some money through savings can earn good interest on the capital through smart investing. Following are four ways through which hassle-free investment can be done which can give great returns.
- Fixed Deposits
Fixed deposits are one of the oldest and safest ways to let your money grow. No extra account has to be opened and every savings account holder can open a fixed deposit with the same branch. The fixed deposit schemes offered by the banks are very lucrative.
You can set aside some small amount every month and when you have enough amount to invest, then you can put it in fixed deposit.
Equity-linked saving scheme is a type of mutual fund that can help you in saving taxes. Up to Rs. 1.5 Lakhs of investment in ELSS qualifies for a tax deduction under section 80C of the Income Tax Act.
Hence, ELSS provides tax benefits along with a decent growth rate. The general returns possible in a ELSS mutual fund lies between 8-12 % per annum. This can be a better option than investing money in fixed deposits. However, you will have to keep investing for a longer period of time to see better results.
- Public Provident Fund (PPF)
PPF is a direct tax free investment scheme for government-sponsored savings and retirement planning. It can be very beneficial for individuals who do not have a structured pension plan.
The interest rate on the PPF is based on the interest rates in debt markets. However, the money gets locked in for a period of 15 years. Partial withdrawals are allowed only after the sixth year. Redemption proceeds are tax-free in the hands of investors.
New Pension Scheme (NPS)
New Pension Scheme (NPS) is regulated by the Pension Funds Regulatory and Development Authority or the PFRDA. It is specifically designed for those who are planning to invest for retirement.
Any citizen of India between the age of 18 to 60 years is allowed to participate in it. The fund management charges are very low in this type of investment and hence, it is cost-effective.
Given the varied options, NPS is beneficial for individuals, with varying risk appetites, looking to set aside money towards retirement.
These were some of the hassle-free investment options for individuals who want to see their money grow, earn passive income or are just planning for their retirement. Choose the best investment option which suits your expectations.