Which is the Best Investment Plan in India for Students ?
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- Updated On:01-Apr-2023
- Replies:2
Short Answer
There are several investing choices accessible for Indian students that might assist them in beginning their future savings. There are several options for students to build their money and make financial plans, including standard savings accounts, term deposits, and mutual funds.
Detailed Answer
The secret to long-term wealth accumulation is early best investment. Anybody who wants to secure their financial future must invest, and students are no exception. This will help you to make sound financial choices, whether you're a college student or even just entering the career check for these options:
1. Mutual Funds
Because they're simple to understand and manage, mutual funds are a crowd-pleasing investing option for students. Funds are indeed different, which ensures your investment is apportioned out over multiple industries, minimizing the potential of losing the entire amount at onetime.
Mutual funds are also controlled by an skilled fund manager, making them a accessible choice for students who might just lack the time or skills to handle their own assets.
2. Equity- Linked Saving Scheme( ELSS)
ELSS is a kind of fund which offers tax benefits under Section 80C of the Income Tax Act. It has a lock- in period of three years, and the minimal investment amount isRs. 500. ELSS funds invest primarily in equities and have the capability to give high returns than other tax- saving options.
3. Unit Linked Insurance Plan( ULIP)
It's a combination of insurance and investment. It offers life insurance coverage along with the chance to invest in equity or debt markets. The minimal investment amount for ULIP isRs. 1000, and it has a lock- in period of five years. ULIPs similarly offer tax advantages under Section 80C of the Income Tax Act.
4. Recurring Deposits( RD)
RD is a savings scheme offered by banks that allows you to invest a fixed amount every month. The interest rate is fixed, and the maturity period ranges from 6 months to 10 years. The minimal amount for investment isRs. 100, and there's no maximum limitation. RD is a secure investment option with guaranteed returns.
5. Public Provident Fund( PPF)
PPF is a government- backed savings scheme that offers tax benefits and a set rate of interest. It's a long- tenure investment option, with a maturity period of 15 years, making it a great option for students who are looking for a stable investment option. The interest earned on PPF is tax-free, and the investment is eligible for tax deductions under Section 80C of the Income Tax Act.
6. National Savings Certificate( NSC)
NSC is another government- backed investment option that offers a fixed rate of interest. It's a long- term investment option, with a maturity period of 5 years, and is eligible for tax reductions under Section 80C of the Income Tax Act. NSC is a good investment option for students who are looking for a stable investment option with tax aids.
7. Stock Market
Investing in the stock market can be a little risky, but it can also be a great way to attain high returns. It's significant for students to do their exploration and invest in companies that have a good track record. Its also essential to have a long- term outlook and not to get affected by short- tenure market changes.
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Discussion (1)
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kaushal93patel
Determining the best investment plan for students in India involves considering various factors such as risk tolerance, investment goals, and financial situation. Students often have limited funds and a shorter investment horizon compared to working professionals or retirees. Therefore, investment options that offer liquidity, low risk, and potential for growth are typically preferred. One popular investment plan for students in India is a Systematic Investment Plan (SIP) in mutual funds. SIPs allow students to invest small amounts regularly in diversified mutual fund schemes, offering the benefits of rupee cost averaging and professional fund management. Equity-linked savings schemes (ELSS) are also attractive for students seeking tax-saving benefits while investing in equities for potential higher returns. I personally have recently started an SIP with Kotak Mutual fund.