Want to save and invest in a younger age
People are looking for good alternatives to secure future financially. People’s confidence is now growing on alternative options rather than fixed deposits (FDs), gold, savings accounts.
Ideally and practically, the person should start saving and investing as soon as he takes his first job. The investment should be done in such a way that you can help in increasing the capital. In this regard, we have talked to financial planner Jitendra Solanki to find out what could be the best and the best option for any job seeker.
Know about five options-
Mutual Funds –
Mutual funds (MFs) are the most important way to invest. Here investors can earn better returns than the investments made with lower capital. The simplest way to invest in MF is Systematic Investment Plan (SIP). Investing in this can be done only with a sum of 500 rupees.
Experts believe that in order to keep rising inflation and financially secure financially, this investment should continue to increase according to its income growth. The rate of interest is also available in the range of 15 to 16 per cent.
Public Provident Fund (PPF) –
PPF is one of the most popular schemes among the common people. PPF’s investment is tax-free in EEE ie “Exit -Extemplate-EXEMPT” category. That is, the amount invested will go into the category of tax-free income, while the interest earned is also tax-free. With this, the amount on maturity is also completely tax-free. The interest rate on this is calculated annually. Interest is paid on 31 March every year. Interest on PPF is calculated based on the minimum balance between the 5th of every month and the last day. Investing in early months is therefore beneficial.
Employee Provident Fund (EPF) –
EPF account is for job professionals. In this, your employer deposits a portion of salary to the PF office (currently 12 percent of the time). This fixed amount is determined by the government and in this amount, the employer also makes a deposit by adding his share (part of our CTC). EPF’s money can be withdrawn anytime after 3 months of leaving your current job.
National Pension Scheme (NPS) –
This savings plan is specifically for people over 65 years of age. However, the person taking VRS (voluntary retirement) can open this account three months before retirement. This account can be opened from a thousand rupees. The maximum investment limit is Rs 15 lakhs. The maturity period of this account is five years. This account can also be opened as joint account with your wife.
In the Bank Fixed Deposit (FD) and Recurring Deposit (RD) –
Fixed Deposit, the investor gets fixed returns at fixed intervals, and the market volatility does not have any effect on this. For the period ranging from 7 days to 10 years, the interest rate is usually ranged from 4 percent to 8 percent. After the expiry of the expiration of the FD, the investor gets the full amount back with interest. At the same time, the bank also periodically reviews the rates of fixed deposits according to the market.
Recording deposits are considered better in terms of regular savings. Interest rates on RD range from 7.25 percent to 9 percent. It depends on customer’s plan and bank. The minimum limit for investing in most banks’ recurring deposits starts from Rs 100. At the same time, the maximum limit is up to 1.5 lakh rupees. There is five to 10,000 thousand maintenance in the account.
Better option than 10 years of investment history-
Solanki believes that for a period of 10 years, the mutual fund can prove to be a better option in all these. The average return on this is between 10 to 12 percent. Also, if investment trends are seen, increase in awareness through advertisements has seen record investment in SIP in May. According to data of Association of Mutual Fund in India (AMFI), Rs.7304 crores have been mobilized through this. This figure is nine percent more than the first month of the year, Rs 6690 crore.
By :– Abhishek Bajpai