Do you know what are the most preferred investment option where majority of Indians are investing? What are the best investment options in India where people love to invest regularly?
I was reading ET Wealth weekly magazine and discovered an interesting survey where they have listed down – what are your preferred investment options? And the data is really amazing as direct stock market investment has not been able to make a place in this list. I will analyse the data and discuss about why people generally choose these investment options over other products.
Most Preferred Investment Option
- 22% people invest in Life Insurance policies
- 21% people invest in bank fixed deposit schemes
- 14% people invest in public provident funds
- 9% people invest in Mutual funds
- 7% people invest in Gold investments
So, data is clearly saying why insurance products are so much popular in our country. This also indicates that people are hardly aware about the actual importance of insurance, rather making it as an investment option.
This is also true because majority of investors from our country are looking for secure & guaranteed return from investment, irrespective of how much yield they will get every day.
I am getting many comments everyday asking for which insurance policy is better, whether the 5-6% return is guaranteed or not. As people are only looking for guaranteed return.
I doubt, whether this data will be same in coming years as people are getting educated by many online sources, blogs on why one shouldn’t buy a life insurance policy to get return.
2. Bank FDs are the Best Way to Start Investing
Bank FDs are very popular investing option for many people, as one can buy such products in various duration. This also gives huge flexibility to an investor.
As a beginner in investment, it is always advised to start with a recurring deposit or FD. With this, one can learn the habit of investment and also whenever it is required, break the deposit and utilize the money for any short term goal.
3. People know the Power of PPF & Compounding
Investing in PPF is a very good practice. And almost every financial planner advises to invest a part of your surplus money in such products for long term basis.
PPF can give a very good return in long term if one can invest regularly. And it is totally a tax free income.
The 14% data is a good indication and I believe it will go up in coming years.
4. Increasing Popularity of Mutual Funds in India
I was reading in couple of sources that in last 1-2 years the market of mutual fund investment is getting larger & larger day by day. This is also true as stock market is touching a new high in every few weeks.
Anyway, it is proved that investing in stock market via mutual fund for a longer term is always benefiicial and it provides a healthy return. In fact sometimes more than 14%, which is best among all products.
I am sure that the data of 9% will change drastically in coming years and it will go upward only.
5. Investing in Gold in India is a Traditional Habit
Now one cannot stop people buying gold whether for investment or other use. People will buy gold whatever the situation is. In fact many experts are not recommending gold as a primary investment these days, but still one should keep a percentage of Gold as investment in their portfolio. But be careful, if you think you have invested in gold by gifting a jewelry to your wife, then actually you are wrong. Read how one can invest in Gold.
So, if we add all these investment options data it will be total 73% only.So what are the other 27% investment options where people are preferring to invest? There are many more preferred investment option in market. But if one research a bit carefully among these 5 investment options and allocate fund as per requirement, I think he/she will be able to do their own personal finance planning.
What is your preferred investment option among them? Share your query or feedback by writing a simple comment.