Best ways to invest annual bonus in India
1. Investment In LIC
You can invest in insurance policies & receive dual benefits. You don’t just get life security, but you can also get good returns on the maturity of the policy.
2. Investment in Mutual Funds:
If you have a good portfolio manager & you are well aware of the market risks you may face, then you can invest in the same. Just make sure you read the offer document carefully before investing! This may turn out to be a little risky investment.
3. Investment in stock market:
You can study the financial statements of any emerging & growing company & if you find it appropriate, you can invest in the same.
4. Investment in gold bonds and other bonds:
You also have many options in bonds & you can choose the one which suits the best to you. They provide a good & timely return & are preferred as Long Term Investments these days.
5. National Savings Certificate:
It is an investment with the Government. So, it has got to be safe & it also provides tax benefits. They are for a fixed term having a fixed interest rate notified by the Government & it also provides good & safe returns.
6. Public Provident Fund – PPF:
The minimum contribution required in a year for a Public Provident Fund (PPF) Account is Rs. 500 and the maximum could be up to Rs. 1.5 Lacs. There is a lock in period of 15 years and all these years, you will be getting interest on your accrued interest too! That is, you will receive compound interest every year on a rate specified by the Government.
Also, interest received each year is exempt & the contribution made each year is allowed as deduction under chapter VI A.
So, this investment will have tax saving benefits also! Any person can open a PPF account with a nationalized bank and make a very safe and secure deposit here. A basic difference between PPF & NSC is that NSC is generally for a shorter term while PPF is for a longer term.
7. Fixed Deposits (With Banks Or Cooperative Societies):
This is a also a good way to pool your savings and keep them safe and also receive a good amount of interest! Tax saver FDRS are also a good option which can be invested in. Besides, if there is an urgent requirement, you can go for a premature withdrawal. So, this can turn out to be a very helpful investment.
8. Recurring Deposits / Flexi Deposits:
Just like FDs, here you can invest the amount not in just one go but periodically. This will have dual benefits, you will get the same advantage of a lump sum amount at the maturity like that in FD, & apart from that, here you don’t need to pay the entire principal in one go! So, it doesn’t hit hard on your pocket & you can make great investments.
In this way, you can earn good returns on the annual bonus earned by you