In India, we have many types of investors – Risk-averse, Aggressive and Moderate. Generally, Risk-averse investor look for those investment schemes which can provide them secure returns on their investments. Namely, these investment options are Tax-Free Bonds, Public Provident Fund, Fixed Deposits etc. If we keep on investing in schemes like Public Provident Fund or Fixed Deposits year by year, we may be able to create good corpus within the time span of 5-7 years, but keeping the inflation in mind we may not get such lucrative returns on our secured investment schemes. The better idea of coming out of the shell of secured investment schemes is to choose those schemes which can provide inflation beating returns and balance the overall investment portfolio. Before we figure-out which investment option will be suitable for risk-averse investor to beat inflation-beating returns, let us first have a look at the current scenario of secured investments schemes -
Current Scenario of Low-Risk Investment Schemes:
For April-June’17, PPF interest rate has been locked at 7.9%, but it seems that it can marginally go down for next quarter, keeping the current inflation (which is under 4%) and RBI target band in mind. Investors generally look PPF as an alternative to Fixed Deposits, and in the scenario of falling interest rates, FD’s are offering an interest rate less than 7% p.a., where interest is fully taxable. Seeing the current scenario, it is clear somewhere we cannot depend on these schemes only to plan our financial goals of life and to create wealth. We need to have a contingency plan to give pace to our investment portfolio.
Contingency Plan to Give Wings to Your Slow-moving Investment Portfolio:
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Esta historia es de la edición May 2017 de Investors India.
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