The Reserve Bank of India (RBI) issued 8% Savings (Taxable) Bonds until the year 2003. After that, it replaced it with 7.75% Savings (Taxable) Bonds. These bonds come with a tenor of seven years. The investors can receive the bonds in Demat form and get it issued to the Bond Ledger Account (BLA). The investors are given a certificate of holding as proof of investment. Since the apex of the nation is issuing these bonds, they are considered a safe investment option.
his infographic can be a template, which one can use to prepare their own investment plan.
This template can work as a tool that will help you in establishing a correlation between your income, financial goals, and the selected investment options.
What is shown in the above infographics is this:
- Investment Funding: Even before one can start investing money, it is essential to start saving money. It is ultimately our savings that can fund all investment needs. Please read more about tricks to save money in day to day life.
- Investment Objective: For an average middle-class person, it is important to have the right objective of investment. Because goal-less investing will be ineffective. I have suggested
Public Provident Fund (PPF) is a popular investment option offered by the government. One can invest up to Rs 1,50,000 a year while a minimum of Rs 500 a year is needed to be invested. It is covered under Section 80C of the Income Tax Act, 1961. A tax deduction of up to Rs 1,50,000 a year can be claimed, and this saves up to Rs 46,800 in taxes. PPF accounts offer assured annual interest and are backed by sovereign guarantees. PPF investments are locked-in for a period of 15 years. However,
Best Investment Plans for Middle Class
The middle-class population in India is on the rise, thanks to the awareness among individuals who are lifting themselves out of poverty through their intelligence and hard work. They are not as rich to purchase whatever they want, and at the same time, they are not as poor as not to afford anything. They are happy when they compare themselves with the poor but feel they lack something when they look at the rich. They are always in search of ways to make more money.
Debt Mutual Funds
Debt mutual funds invest in instruments such as treasury bills, government bonds, high-rated corporate bonds, and other similar money market instruments. The main objective of debt mutual funds is capital preservation and generating steady returns over time. These funds are safer than equity funds as they are not exposed to the equity market. Also, these funds are an excellent means to park money for a long duration as they earn compounded returns which will make the investors wealthier.
National Pension Schemes
National Pension System (NPS) is a saving cum pension scheme. It is under the purview of the Pension Fund Regulatory and Development Authority (PFRDA). Investors can claim an additional tax deduction of Rs 50,000 over and above the Section 80C limit of Rs 1,50,000 a year by voluntarily contributing higher towards their NPS account. The minimum contribution for NPS Tier-1 accounts is now reduced to Rs 1,000 a year from the earlier Rs 6,000 a year. NPS invests across equity, bonds, deposits, among others. Investors are given the liberty to choose the amount of equity exposure they would like to have as per their risk profile.
What I’m saying is nothing new, right? Investment advisors have been saying this for years.
But the problem comes in its implementation.
Buying mutual funds, stocks, bonds, etc in the name of investment is not enough. What is essential is to follow a plan.
Yes, having an investment plan, and investing according to it is essential.
Planning is required because it works like a road map.
This not only can create wealth in long term but can also assist in the financing of needs as and when it comes.
What I will share in this blog post is a template of an investment plan. This template can be used by any person (especially middle-class people like me), whose desire is to invest using a definite plan.
Why follow this template? Because what this ‘investment plan template’ can do is to establish a correlation between one’s income, needs, and investment choices.