Visualise yourself walking into a marketplace, only this time, you’re browsing popular investment options in India in 2023.
First, we have the Public Provident Fund (PPF), much like a reliable grocery store. It’s a government-backed scheme offering a consistent return of 7.1% per annum, a favourite for those who prefer safety over high risk.
Next up is the National Savings Certificate (NSC), another government store, offering a 6.8% return annually. It has a lock-in period of 5 years, much like a fixed-term contract you can’t break easily.
Then there’s the Post Office Monthly Income Scheme (POMIS), akin to a monthly subscription service, giving out returns of 6.6% per annum, popular for its regular income feature.
The Fixed Deposits (FDs) stall is your fixed-rate retailer – you know exactly what you’re getting for the specified period.
If you prefer a mix of things, Mutual Funds and SIPs are your go-to multi-brand outlets. They offer a variety of investment options ranging from stocks, bonds, to money market instruments. SIPs are like buying an assortment of items in small amounts over time, spreading out the cost and risk.
For those who enjoy risk for potential high returns, Equity is the exciting arcade game where you buy company shares. It’s not for the faint-hearted though.
Lastly, we have Gold, the age-old reliable antique shop. It’s a safe bet and also a hedge against inflation.
The foot traffic varies at each ‘store’, with data as of March 2023 looking like this:
– PPF: 30 crore accounts with a corpus of over ₹10 lakh crore.
– NSC: 10 crore accounts with a corpus of over ₹5 lakh crore.
– PO-MIS: 5 crore accounts with a corpus of over ₹2.5 lakh crore.
– FDs: 50 crore accounts with a corpus of over ₹25 lakh crore.
– Mutual Funds: 10 crore accounts with a corpus of over ₹10 lakh crore.
Each investor’s choice depends on their financial goals and risk appetite. As Peter Lynch, a renowned investment guru, said, “Know what you own, and know why you own it.” Therefore, before stepping into this market, equip yourself with the right knowledge and choose the best ‘store’ for your needs. And remember, a good financial / investment advisor can be a helpful guide in this bustling marketplace.
