The earlier you start investing, the faster you’ll learn how you can grow your money. It’s not easy to invest during your college days as you have a limited budget. So, we recommend you avoid risky investments and rather invest in safer investment plans that provide you with secured savings with a good return.
These are the best options you can choose without worrying about the risk:
- Fixed Deposit
The main benefit of putting your money in an FD is that it guarantees a profit while also protecting your wealth. FDs enable you to make a fixed-term investment of a specific amount of money at a pre-determined rate of interest.
One can enjoy a higher return on an FD as compared to a savings account, and its interest rate can vary from bank to bank. So, it’s a better option to keep your money in an FD instead of a saving account.
- Mutual Funds
Although mutual funds are not fully risk-free, you can choose a debt-mutual fund that carries minimal risk. We suggest that before investing in mutual funds, you should research them in detail. Being beginners in this field, students should avoid investing in the stock market. Instead, they should choose mutual funds managed by professionals. The initial investment can be Rs.500 per month in mutual funds.
A student can save his pocket money or stipend and invest in SIPs, which allow him to create wealth with a small amount of money at regular intervals.
- NSC and PPF
As a student, you can also invest in the National Savings Certificate (NSC) and the Public Provident Fund (PPF). Though these plans are for long-term investments, they assure you returns. The rate of interest is set by the Government as both NSC and PPF are government-backed savings schemes.
Bonds are issued to the public in return for fixed interest when the Government and Corporations want to raise money. Either you can invest in long-term bonds or short-term bonds Long-term bonds can provide a higher return during the maturity period than short-term bonds. As a result, it is one of the most secure investment options available to students.
Investing in the financial market is subject to market risk. We suggest you take advice from a financial advisor.