According to inflation and income tax rates, it is approaching zero if you assess the return on fixed deposits. In such a situation, it is time to switch to such instruments of investment which promise guaranteed returns.
New Delhi. Bank Fixed Deposit (FD) has been the safest, easiest and best return for investment ever, due to people’s preferred investment option (Investment Option). Now due to the falling interest rate, it is not able to give attractive returns. Especially in terms of Inflation, the returns are approaching zero. In such a situation, the time has come to switch to such instruments of investment, which promise Guaranteed Return.
Many investment options exist, including mutual funds (MFs), bonds, PPFs, but investors are looking for an asset class that can offer better returns over the long term ie at least 20-25 years. Investment advisor and CA Harigopal Patidar says that in this context, guaranteed return plans can be better for investment. In this, the returns are good from FD, it is completely tax free. Along with this, life insurance is also available. Let’s know about the benefits of guaranteed return plans ..
Risk cover up to 10 times of insurance money A
person investing in guaranteed return plans also gets a risk cover of 10 times the annual premium. For example, if a person invests 2 lakh rupees annually and has died for some reason, then the dependents will get 20 lakh rupees.
from the first tax, nor the
guaranteed return plans on maturity come fully with tax exemption benefits i.e. There is no tax on the money invested and maturity amount invested. This is the reason that these investment products prove to be better than the post-tax returns of bank FDs.
Decide investment plan according to income tax
The interest rate on long-term deposits offered by most public sector banks is 5.4 percent. In such a situation, for investors falling in the 30 percent tax bracket, the tax return on the money invested will be less than 4 percent.
Retirement funds can also be prepared.
There are also some guaranteed return plans in the market, in which if a 30-year-old man invests Rs. 5,000 every month for a retirement fund with a policy term of 30 years, then at the maturity, about Rs. 50 lakhs lump sum. Can be found
PPF and FD have reduced such interest rate
PPF used to get 11-12 percent interest annually 20 years ago. Now it is paying only 7.1 percent interest. Similarly, in 2014, the interest rate on bank FD was 8.5 percent. It reduced to 5.4 percent by 2020. The problem does not end here. These interest rates are expected to fall by 3-5 percent in the next few years as the country is moving rapidly towards becoming a developed economy.