What is an Investment Plan?

Investment plans are essentially financial instruments that aid in the creation of long-term wealth. Various investment plans in India enable us to invest our savings in various money-market products in a disciplined and periodic manner in order to achieve our financial objectives.

 

Overall, investment plans give us the much-needed benefit of maximising our savings through systematic, long-term investments that create wealth for the future. The first step in developing an investment plan in India is to assess your risk profile and financial needs and then select an investment plan that meets those needs. Some of the investment opportunities in India are as follows :

 

 

These investment plans, like many others, necessitate extensive research before selecting investment schemes that provide long-term sustainable gains, tax benefits, and capital appreciation. Several investment plans in India may be suitable for you.

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What are the Types of Investments in India?

These investment programmes, like many others, need extensive investigation before selecting investment schemes that give long-term sustainable returns, tax benefits, and capital appreciation. Several investment strategies in India may be suitable for you.

 

When deciding amongst the best investment plans with high returns, it is essential to examine the risk associated with these investment plans. The risk of an investment strategy can be represented as the potential or likelihood of the asset performing below expectations or incurring a permanent loss of value.

Different investment strategies are therefore essentially classified into three groups based on the accompanying risk, as indicated below:

Low Risk Investment Options

Low-risk investment plans, as the name implies, are those in which the element of risk is close to nil. In other words, low-risk investing programmes tend to give consistent and steady value increase with little losses. The following is a list of some of the best investment alternatives to explore.

 

  • Sukanya Samriddhi Yojana

    Sukanya Samriddhi Account is quickly becoming known as one of the best investment plans in India for girls. If you have a girl kid, this Yojana tries to make corpus creation easier. Interest rate is 7.6% per annum (Q4 FY 2021-22). Sukanya Samriddhi Yojana accounts can be opened at commercial banks and post offices. Furthermore, you can benefit from substantial tax savings under Section 80C of the Income Tax Act of 1961.

  • Public Provident Fund (PPF)

    Given the variety of benefits it offers, the Public Provident Fund (PPF) is one of the greatest investing options in India. If you are a salaried individual, PPF might provide several benefits. You can claim tax deductions on contribution, under Section 80C of the Income Tax Act of 1961.

  • Postal Service Monthly Income Plans

    Post office monthly income scheme is generally recognised as one of the greatest investment plans. It is best suited for risk-averse persons searching for low-risk investment plans with acceptable returns. You should be aware that, income from post office monthly income schemes is completely taxable, monthly income plans do not qualify for Tax Deduction at Source (TDS).

  • Government Schemes for Senior Citizens (SCSS)

    For a number of reasons, the Indian government's senior citizen savings system - SCSS – is largely considered one of the greatest investing alternatives in India.
    First and foremost, the system provides considerable financial security for older persons. Second, the government sets the interest rate for this plan every quarter. SCSS accounts can be opened at post offices and any nationalized bank.

  • Tax Saving Fixed Deposits (FDs)

    Tax saving fixed deposits (FDs) are widely regarded as one of the best investment schemes and investment plans in India since they give considerable tax savings advantages under Section 80C and can help you reduce your overall tax obligation.

  • Sovereign Gold Bonds

    Sovereign Gold Bonds (SGBs) are issued by the Reserve Bank of India and are guaranteed by the Indian government. SGBs are securities that are denominated in gold units and are used as an alternative to holding actual gold (grams). SGBs are one of the greatest investment alternatives in India since they may be redeemed in cash at maturity.

  • Life Insurance

    Savings and income plans, as well as protection plans, are two types of life insurance that fall into the low-risk category. Such life insurance policies include no discernible investment component, implying that they do not provide market-linked returns. Instead, these life insurance policies provide a solid financial safety net for your family as well as effective protection against life's difficulties.

  • Bonds

    Bonds are certificates that represent your agreement to lend money to the issuer at the specified interest rate. The interest on each bond may be paid to you on a regular basis, and the face value might be refunded at the end. You can also sell the bond before it expires if you need it. Because of their relative safety, bonds are regarded as one of the best investment alternatives in India.

High Risk Investment

High-risk investment plans, as the name implies, are appropriate for investors whose primary goal is long-term capital growth. Meanwhile, most high-risk investment programmes experience big volatility but provide the potential for significant long-term profits. The following are some examples of high-risk investing plans :

 

  • Direct Equities

    Equities provide risk-taking investors with the opportunity to attain their financial objectives. While each asset is important in its own way, equities have an established track record in the long run when compared to other assets. Thus, with an equity investment, you may purchase a portion of a company's ownership, entitling the investor to the company's profits and losses.

  • Unit-Linked Insurance Plans

    Because they provide both life insurance and investment returns, ULIPs, or unit-linked insurance plans, are often considered as one of the best investment alternatives in India. Not only that, but they also offer you the option of dividing your money into three categories: high risk, medium risk, and low risk. This is due to the fact that it allows you to put your money in a variety of different fund possibilities. While a portion of the money is assigned to various fund alternatives (depending on your investment objectives and risk profile), the remainder is utilised to offer much-needed insurance coverage.

     

    Overall, ULIPs are simply life insurance policies with the added benefit of investing your money in various money-market linked assets based on your objectives. As a result, ULIPs provide yet another way to invest in a professionally managed portfolio of stocks or bonds. The advantage of investing in a bond fund through a ULIP is that you may be eligible for a tax deduction under Section 80C if certain requirements are met.

     

    ULIPs provide a clear classification of risk categories, allowing you to select the greater risk fund for long-term goals. As your investment approaches maturity, you can progressively transition to lower-risk assets.

  • Mutual Fund

    A mutual fund is established when money is collected from several individuals and invested in the stocks or bonds of a corporation. A mutual fund is often owned by thousands of individuals and managed jointly to maximise profits. A professional fund manager is in charge of the mutual fund.

     

    Mutual funds provide diversification with a reduced investment corpus in any or all assets. You can, for example, invest in a pure equity fund, a debt fund, or a hybrid fund that invests in both equities and bonds.

     

    Mutual funds may provide distinct risk category funds based on the equities or bonds in which they invest.

Medium-Risk Investments

Medium or moderate risk investments, as the name implies, are investment programmes that function as diversified or balanced investments. Investment plans with a moderate risk profile provide not only the opportunity for development but also the willingness to accept some market volatility.

 

Most medium risk investment strategies assist diversify your investment portfolio by utilising a combination of equity and debt instruments to create consistent returns while avoiding large dangers. The following are some examples of medium risk investing plans :

 

  • Monthly income plans
  • Arbitrage funds

Which Investment Plan Best Suits Your Financial Needs in India?

Choosing between investing alternatives in India gets easier when you analyse the risk-return potential of all investment programmes. As a wise investor, you should diversify your financial portfolio by integrating many investment plans - each with a different risk profile and based on your financial needs.

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When to Start Investing in an Investment Plan

Every one of us has a set of objectives that we hope to attain during our lives. However, in this day and age, we cannot rely solely on our money. We may achieve these objectives by developing a solid financial portfolio through investment programmes.

 

To achieve your goals of purchasing a home or financially guaranteeing your retirement, it is critical that you find the best investment plan that will help you increase your money over time. As a result, before you begin investing in any of the top investment plans with high returns, you should have a goal and a rough schedule in mind. Remember, after you've identified a goal, you should begin investing as soon as possible — doing so will help you speed the process.

Why Should You Invest in Investment Plans?

If you are a salaried or self-employed individual, keep in mind that you cannot attain your goals just via savings – you must optimise your resources and develop wealth through investment strategies. To amass riches, you must invest in some of the top investment possibilities with high returns.

 

If you do not invest, you will most likely miss out on possibilities to increase your financial worth and wealth-building potential. While there is a danger of losing money with investment plans, there is also a considerably stronger possibility for considerable return - provided you invest properly and on time.

How to Choose one of the Best Investment Plans

Here's how to pick the finest investment plans among India's greatest investment options :

 

  • Examine your financial requirements and objectives.
  • Calculate the time it will take you to invest in order to reach each objective.
  • Create a plan by combining the appropriate insurance and investment products that are in line with your objectives.
  • Diversify your holdings – You may have invested in a single investment plan, but you should consider numerous investment and insurance programmes.
  • Learn about the various fees that are paid on various investing plans.
  • Review your investing strategies on a regular basis.

Factors to Consider While Choosing an Investment Plan in India

  • Financial Objectives

    The first thing to consider when selecting an investing strategy is your financial objectives, both long-term and short-term. These aspirations might range from marriage and school to foreign travel and new cell-phones, and having such financial goals in mind can allow you to make an informed decision. For example, if you wish to save money for a vacation to your favourite overseas place, a recurring deposit or post office deposit may be one of the best investment schemes for you.

  • Upcoming Expenses

    If you're searching for an investing plan in India, a vital first step is determining your anticipated future costs, such as your child's marriage and schooling or the purchase of a property. This will give you a clearer picture of how much you need to invest now in order to receive sufficient returns later to cover any potential expenses.

  • Current Expenses

    Evaluating your current spending is a critical step in determining the appropriate investing strategy. For example, if you don't have any high costs, such as housing rent, you may save or invest more in the long term. However, if you have financial responsibilities that prevent you from saving much, investing in one of the best investment schemes will be more helpful.

  • Dependents on Income

    Most individuals in India do not consider their financial dependence while purchasing an investment plan. However, doing so is critical since you must have an investment or savings pool that is sufficient for your dependents' monetary aspirations as well. For example, if you just have two children who rely on you, you may not need to invest as much as someone who also has parents, siblings, and children to care for.

Short Term Investment Plans

Best Investment Plans for 1 Year

If you like short-term investments, a lockup period of even three years may seem excessive. However, there are several 12-month investing programmes that can help you avoid market dangers. Here are some excellent short-term investing plans to consider :

 
  • Recurring Deposits
  • Fixed Maturity Plan
  • Post Office Deposits
  • Arbitrage Funds
  • Debt Funds
  • Fixed Deposits
 

Best Investment Plans for 3 Year

Three-year investment schemes are a popular version of short-term investment plans, and they are best suited for people who expect large returns in a short period of time. Here are a few alternatives to consider :

 
  • Liquid Funds
  • Fixed Maturity Plan
  • Recurring Deposits
  • Savings Account
  • Arbitrage Funds
 

Best Investment Plans for 5 Year

Although 5 years is a lengthy time, in India, a 5-year investment plan is often seen as a short-term investment with modest market risks. However, the returns on a 5-year investment programme are significantly larger than those on other short-term investments. So, here are some possibilities for you to consider :

 
  • Savings Account
  • Liquid Funds
  • Post Office Time Deposit
  • Large Cap Mutual Fund

Types of Investment Plan We Offer

Bharti AXA Life Wealth Pro

  • An Individual Linked life cover with Insurance cum Savings Plan.
  • Choose a Variant: The plan offers you two variants to choose from a) Growth Variant b) Legacy variant
  • Grow your wealth further with Wealth booster
  • Multiple Investment Strategies to suit your investment needs
  • Tax benefits

Bharti AXA Life eFuture Invest

  • An affordable online Investment Plan.
  • Choose between two premium payment terms
  • Flexibilty of Partial withdrawal
  • Zero allocation charges
  • Tax Benefits

Bharti AXA Life Grow Wealth

  • Flexibility in Investment Tenure T
  • Single Life/Joint Life Option
  • Grow your wealth further with Loyalty Additions
  • Multiple Fund Options to suit your investment needs and zero premium allocation charges
  • Tax benefits

FAQs

Is investing in Unit Linked Insurance Plan (ULIP) a good idea?

ULIPs or Unit Linked Insurance Plans combine the advantages of insurance and investment, and this is what makes them an excellent investment tool.

What are some good investment options in India?

Some good investment options available in India include –

  • ULIPs
  • PPFs
  • Mutual Funds
  • Sukanya Samriddhi Account
  • Monthly Income Plans
  • Tax Saving Fixed Deposits
  • Senior Citizens Saving Schemes

What are the best short-term investment options in India?

Some of the best short term investment options available in India are –

  • Recurring Deposits
  • Fixed Maturity Plan
  • Post Office Deposits
  • Arbitrage Funds
  • Debt Fund
  • Fixed Deposits

Factors Impacting ULIP Plan Premium

Unit Linked Insurance Policy

An insurance plan which gives benefits both of life insurance as well as investing in different funds consisting of different investment instruments like stocks, money market securities or government bonds. However, the returns are dependent on market performance and the policyholder has to bear the investment risk.

Date Of Commencement Of Risk

It is the date which represents the beginning of Life Cover.

Grace Period

A specified period after a premium payment is due, in which the policyholder may make such payment, and during which the protection of the policy continues

---A period during which the Policyholder can still make the overdue Premium Payment without attracting any interest. Grace period is of 30 days from the original due date as stipulated by regulation and the benefits under the Policy remain unaltered during this period.

Investment Fund Allocation Instruction

It is the instruction given by the Policyholder to allocate his premiums towards the purchase of units in the desired Investment Fund.

Investment Risk/market Fluctuations

The performance of the Investment Fund depends on the financial markets and may increase or decrease. The risk of such fluctuations or uncertainties due to market related factors is called as the Investment Risk.

Lock In Period

It refers to the number of years for which the funds need to be kept invested in the policy and cannot be withdrawn.

Disclaimer:

*Tax benefits are in accordance to current tax laws that are subject to change from time to time.

IN ULIP POLICIES, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER

The Unit Linked Insurance Products do not offer any liquidity during the first five years of the contract. The policyholder will not be able to surrender or withdraw the monies invested in Unit Linked Insurance Products completely or partially till the end of the fifth year

Bharti AXA Life Insurance Company is only the name of the insurance company and Bharti AXA Life Wealth Pro is the name of the Unit Linked insurance product and does not in any way represent or indicate the quality of the product or its future prospects. UIN- 130L100V01

Bharti AXA Life Insurance Company is only the name of the insurance company and Bharti AXA Life eFuture Invest is the name of the Unit Linked, non-participating insurance product and does not in any way represent or indicate the quality of the product or its future prospects. UIN- 130L063V02

Bharti AXA Life Insurance Company is only the name of the insurance company and Bharti AXA Life Grow Wealth is the name of the Unit Linked insurance product does not in any way indicate the quality of the product or its future prospects. UIN- 130L088V03

#For 30 Year Old Male, Endowment Plan Option, online purchase of policy excluding underwriting extra premium & GST. ^As lumpsum payout at the end of 20th year.

Advt No.- II-Mar-2022-3744