Investment plans are crucial for achieving various financial goals. However, many salaried individuals don’t know the investment plans that can help them meet their objectives.
In this article, we will discuss a few monthly investment options for employees.
An investment plan can help a person achieve his/her short-term or long-term financial goals and live a stress-free life. Investments can help individuals earn significant returns. There are a lot of investment options for salaried individuals.
Let’s take a look at some of them-
Equity Mutual Funds
Equity mutual funds primarily invest in equities. While many people don’t know have the knowledge of investing directly in the share market, these funds allow them to invest in stocks. Thus, investors can take benefit from the substantial returns. Furthermore, investors should have a high-risk appetite if they want to invest in equity funds.
Some of the equity mutual fund schemes are-
- Large Cap Funds- These funds invest in large-cap companies.
- Mid Cap Funds- These funds invest in midcap companies.
- Small Cap Funds- These funds invest in small-cap companies.
- Multi Cap Funds- These funds invest across all market capitalisations, themes, and segments.
Debt Mutual Funds
Primarily, debt mutual funds invest in fixed income instruments like corporate bonds, money market instruments, government securities, etc. Debt mutual funds are less risky compared to equity mutual funds. Here are some of the debt mutual fund schemes- Gilt fund, corporate bond, government securities, etc.
Investing in gold is one of the most preferred options for many salaried individuals. Gold is opted by many because its value generally stays stable compared to other investment instruments. Furthermore, it is a good long-term investment option. People can also buy gold ETF.
Unit-Linked Insurance Plan
A unit-linked insurance plan (ULIP) is an insurance product that provides the benefit of life insurance as well as investment returns. When a person invests in a ULIP, a part of the premium is invested in investment instruments like stocks, market instruments, bonds, etc., and the other part goes towards life cover. Therefore, such plans can offer death benefit and maturity benefits.
An investor should select a ULIP based on his/her risk appetite. For instance, if an investor has a high-risk appetite, then he/she should consider investing in equities. Furthermore, people can switch between funds to maximise the returns or make their portfolio stable.
International funds invest in equity and debt securities of companies or entities listed outside India. These funds invest in foreign funds that invest in overseas markets.
Things to Consider Before Making Investments
- Investment Goals
Before starting to invest, an investor should understand his/her investment goals. Investors should know how long they must stay invested in order to achieve their goals.
- Risk Appetite
There are risks associated with every investment. When a person knows his/her risk appetite, he/she can make a better decision while selecting an option. Understanding risk appetite and investment objectives are critical while building a financial portfolio.
Carrying out research is very important before investing. Every investor should understand the plan they want to invest in.