Invest in Mutual Funds &
Get More Returns

Start Investing

Investment is defined as an asset that is bought, which has the capability of generating wealth or appreciate over time.

1. Why investments?

Investments are important because in today’s world, just earning money is not enough. You work hard for the money you earn. But that may not be adequate for you to lead a comfortable lifestyle or fulfill your dreams and goals. To do that, you need to make your money work hard for you as well. This is why you invest. Money lying idle in your bank account is an opportunity lost. You should invest that money smartly to get good returns out of it.

2. Types of Investments in India

The Indian investor has a number of investment options to choose from. Some are traditional investments that have been used across generations, while some are relatively newer options that have become popular in recent years. Here are some popular investment options available in India.


Stocks, also known as company shares, are probably the most famous investment vehicle in India. When you buy a company’s stock, you buy ownership in that company that allows you to participate in the company’s growth. Stocks are offered by companies that are publicly listed on stock exchanges and can be bought by any investor. Stocks are ideal long-term investments. But investing in stocks should not be equated to trading in the stock market, which is a speculative activity.

Mutual Funds

Mutual funds have been around for the past few decades but they have gained popularity only in the last few years. These are investment vehicles that pool the money of many investors and invest it in a way to earn optimum returns. Different types of mutual funds invest in different securities. Equity mutual funds invest primarily in stocks and equity-related instruments, while debt mutual funds invest in bonds and papers. There are also hybrid mutual funds that invest in equity as well as debt. Mutual funds are flexible investment vehicles, in which you can begin and stop investing as per your convenience. Apart from tax-saving mutual funds, you can redeem investments from mutual funds any time as well.

Fixed Deposits

Fixed deposits are investment vehicles that are for a specific, pre-defined time period. They offer complete capital protection as well as guaranteed returns. They are ideal for conservative investors who stay away from risks. Fixed deposits are offered by banks and for different time periods. Fixed deposit interest rates change as per economic conditions and are decided by the banks themselves. Fixed deposits are typically locked-in investments, but investors are often allowed to avail loans or overdraft facilities against them. There is also a tax-saving variant of fixed deposit, which comes with a lock-in of 5 years.

Recurring Deposits

A recurring deposit (RD) is another fixed tenure investment that allows investors to put in a specific amount every month for a pre-defined period of time. RDs are offered by banks and post offices. The interest rates are defined by the institution offering it. An RD allows the investor to invest a small amount every month to build a corpus over a defined time period. RDs offer capital protection as well as guaranteed returns.

Public Provident Fund

The Public Provident Fund (PPF) is a long-term tax-saving investment vehicle that comes with a lock-in period of 15 years. Investments made in PPF can be used to earn a tax break. The PPF rate is decided by the Government of India every quarter. The corpus withdrawn at the end of the 15-year period is completely tax-free in the hands of the investor. PPF also allows loans and partial withdrawals after certain conditions have been met.

Employee Provident Fund

The Employee Provident Fund (EPF) is another retirement-oriented investment vehicle that earns a tax break under Section 80C. EPF deductions are typically a part of an earner’s monthly salary and the same amount is matched by the employer as well. Upon maturity, the withdrawn corpus from EPF is also entirely tax-free. EPF rates are also decided by the Government of India every quarter.

National Pension System

The National Pension System (NPS) is a relatively new tax-saving investment option. Investors in the NPS stay locked-in till retirement and can earn higher returns than PPF or EPF since the NPS offers plan options that invest in equities as well. The maturity corpus from the NPS is not entirely tax-free and a part of it has to be used to purchase an annuity that will give the investor a regular pension.

3. Where should you invest your money?

Since there are so many types of investment vehicles, it is normal for an investor to get overwhelmed. Someone new to investing would not where to invest their money. Making the wrong investment choice can lead to financial losses, which is something that no one wants. This is why you should use the following factors to decide where to invest your money.


Typically, younger investors have fewer responsibilities and a longer time horizon. When you have a long working life in front of you, you can invest in vehicles with a long-term view and also keep increasing your investment amount with an increase in your income. This is why equity-oriented investments like equity mutual funds would be a better option for young investors, as compared to something like fixed deposits. But on the other hand, older investors can opt for safer avenues like FDs.


Investment goals can be either short-term or long-term. For a short-term goal, you should opt for a safer investment and use the return-generating potential of equities for long-term goals. Goals can also be negotiable and non-negotiable. For non-negotiable goals like children’s education or down payment for a house, guaranteed-return investments would be a good choice. But if the goal is negotiable, which means that it can be pushed back by a few months, then investing in equity mutual funds or stocks can be beneficial. Plus, if these investments do really well, then you can even meet the goal before time.


Another thing to think about when choosing an investment option is your own profile. Factors like how much you are earning and how many financial dependants you have are also critical. A young investor with a lot of time on hand may not be able to take equity-related risks if he also has the responsibility to take care of his family. Similarly, someone older with no dependents and a steady source of income can choose to invest in equities to earn higher returns.

This is why it is said that when it comes to investments, one size doesn’t fit all. Investments not only have to be chosen carefully but also planned properly to get the most out of them.

4. How should I plan my investments?

The first step in planning your investments is to figure out the right investment that fits your profile and needs. Here are a few things to keep in mind when planning your investments:

  • Choose investments carefully after doing adequate research
  • Don’t fall for quick-buck schemes that promise high returns in a short time
  • Review your stock and mutual fund investments periodically
  • Consider the tax implications on returns you earn from your investments
  • Keep things simple and avoid complicated investments that you don’t understand

In this article, we have learned a lot about investments and the various types of investments. Now, it’s your time to be smart and to generate wealth.

Invest in Hand-Picked Mutual Funds

Save on Taxes and Build Wealth

Start Investing Now

Make Small Investments for Bigger Returns

Start SIP Now

All Articles

  1. Are you worried about your retirement? Here is everything you need to know about the most preferred investment options for retirement.
  2. Should I invest in real estate or mutual funds? This is the first question that arises in the mind of every investor before he/she begins his investment journey
  3. The fee-based advisors charge an annual fee corresponding to the assets they manage. The fee-only financial advisors charge a flat fee on all transactions.
  4. India has seen massive industrial developments over the last two decades and attracts NRIs to consider India a viable destination to invest.
  5. You need to have a margin account with the broker to avail the margin trading facility (MTF). The margin varies across brokers. Margin trading is a facility under which you buy stocks that you can’t afford. You are allowed to buy stocks by paying a marginal amount of the actual value.
  6. In a SIP, you can set aside a small amount of money monthly or quarterly rather than investing a lump sum. On the other hand, an RD lets you deposit a fixed amount each month for a predefined duration. At the end of the tenure, you will get back the principal amount and the interest.
  7. Top 6 Safe Investments in India that offer good returns. With a plethora of options to choose from, it's quite obvious that one would not be sure of where to invest. To term a particular investment avenue as the ‘best’, we need to analyse one’s requirement and risk appetite.
  8. Traditionally, the Indians are conservative investors, and they generally don't prefer investing in risky investment options. However, the trend is changing of late. Stock markets, mutual funds, and corporate bonds have become a viable investment option in India.
  9. Indians prefer investing in traditional investment options such as provident funds and bank deposits. Indians are not risk-oriented, and they don’t invest much in the equity-linked schemes.
  10. A trading account is used to buy or sell equity shares in a stock market. Previously, the stock exchange functioned on the open outcry system. In this, the traders used hand signals and verbal communication to convey their buying/selling decisions.
  11. Under dematerialisation, your share certificates are converted from physical form to electronic form so as to increase their accessibility. You need a Demat Account number to settle trades electronically. Having a Demat Account allows you to buy shares and store them safely.
  12. If you have decided to invest in a home and have already crossed your 30s, don’t worry. You can still work out a sensible investment plan and own a house in near future. Let us help you with the same.
  13. Derivatives are financial contracts whose value is dependent on an underlying asset or group of assets. The commonly used assets are stocks, bonds, currencies, commodities and market indices. The value of the underlying assets keeps changing according to market conditions.
  14. Starting your investments as soon as you start working i.e. in your 20s will give you an edge. You have a better chance to secure your retired life without much hassle.
  15. Stock market terminology relates to industry-specific jargons which are used in the stock markets regularly. Even the experts and amateurs use these terms frequently to explain trading strategies, indices, stock market patterns and other components of the stock trading industry.
  16. The great thing about SIP is that allows investors convenience in their investment. The investors do not need to make the periodic payments as it is deducted from their account automatically.
  17. Getting a raise is a right time to make smart investing decisions. Understand how even the smallest of increase in your Systematic Investment Plan can help generate greater returns for you to achieve your financial goals. If you have an SIP, increase your monthly contribution to the same as your inc
  18. For those of you wondering how to become a crorepati in 10 years time, one point to note is that the earlier you start investing towards your future the sooner you will reach your goal. Here we have few tips and guidelines to help you accumulate your first milestone through systematic and discipline
  19. A stock market is a platform where investors can buy and sell the shares of publicly traded companies. If you want to invest in the stock markets you must first understand how this market actually works. Here we give you an insight into how the stock markets function.
  20. Financial planning or the lack of it in your 50s can either make or break you. This decade is particularly significant as you need to make provisions for your retirement, have funds for your children’s education, have reserves for emergencies and of course save enough for a comfortable future. Here
  21. Financial planning can seem like a daunting task for many but it doesn’t have to be that way anymore. In your 40s, your priorities and your goals will be very different from that in your 20s or 30s and hence your planning must also take this into account. To help you build your wealth and have a sol
  22. Fixed Income Investments - Here we have compiled some of the best-fixed income investment options that are on offer in India. The list includes some well known as well as some lesser known funds and schemes that can be availed by Indian citizens.
  23. When stock split takes place, there is an increase in the number of shares of that company without any change in the market capitalization. The number of shares during a stock split goes up but the price per share goes down.
  24. When an investor subscribes to the equity share of a company, he becomes a shareholder. For the company, such a contribution is like a liability on which it needs to give returns to the shareholder. Investors earn returns in equity investments by
  25. Invest in Best SIP Plans through ClearTax. Get higher returns than any other tax saving schemes. Know about top Systematic Investment Plans / SIP Mutual Funds 2019 in India.
  26. Multi-cap funds invest in equity shares of companies which belong to different market capitalization like large-cap, mid-cap & small-cap stocks in the portfolio in a specific proportion. Read this article to know about best multi-cap funds of 2019.
  27. Best Debt Mutual funds 2019 : As as investor, you might always be on a lookout for the best debt funds to invest your money. Read more to find out the critical aspects which you need to consider before making a final decision.
  28. Small cap mutual funds invest in stocks of large companies or with small market capitalization. Read about best small cap mutual funds in India for 2019.
  29. Large cap mutual funds invest in stocks of large companies or stocks with large market capitalizations. Read on to know about the best large cap funds in 2019.
  30. Mid-cap mutual fund schemes invest in stocks of large companies or stocks with large market capitalisation. Read on to know the best performing mid-cap mutual funds in 2019.
  31. A Balanced Fund is a mutual fund which invests its portfolio in a mix of debt and equity instruments. Read on to know about the best balanced Mutual funds in 2019.
  32. Liquid funds are mutual fund schemes that invest in short-term debt securities like treasury bills which generate fixed income. Read on to know about the best liquid funds in 2019.
  33. Fixed Maturity Plans are debt funds that are close-ended, which means that investments can be made only during the time of an NFO. Read on to know more.
  34. An equity fund is a mutual fund which invests equity shares of companies based on fund's investment mandate. Read on to know how to choose the best equity mutual funds of 2019.
  35. Best short term mutual funds 2019: Short term mutual funds offer a maturity from a minimum of 15-91 days or below that, having historically delivered up to 9% returns. Here are the best short term funds available currently in 2019.
  36. Income funds are a type of debt funds that invest mainly in government bonds, securities that offer dividends or interest payments. Read on to know more about the best performing income funds, and how to invest in income funds, etc
  37. When it comes to the right time to invest in a mutual fund, several things need to be kept in mind. Read on to know more.
  38. To select the best mutual funds suiting your financial goals and income is tricky. Check out 4 tips from ClearTax to make it easier for you.
  39. RGESS - One of the government-sponsored schemes for tax saving is the Rajiv Gandhi Equity Savings Scheme or RGESS. Learn more about it here...
  40. Everything you need to know about investing in the National Savings Certificate to save taxes under Section 80C.