5 Basic Saving Policies Which are No Brainers Yet Effective

Amrita Majumdar
Features writer

As soon as you start your job and earn your first salary you are pounded by questions and advice about investments. Have you started your retirement plan? The market has plunked, the right time to invest, so on and so forth.

This is too much for the brain which was still barely making doable plans for hitting the disc and deciding how to spend the following hung over day. So, here are a few ideas from the YoPeeps team that the rookie investors can resort to who have zilch knowledge of financial investments.

  • Mutual funds and SIP (Systematic investment plan)
  • This one is a time-tested concept which guarantees double digit returns (over 10%). You do not need to invest in individual stocks or companies. You can invest a lump sum amount which on your behalf will be invested in various stocks by the mutual fund company. How well these mutual fund companies invest your money decides the returns you get.

    Lately, a better option has emerged as part of mutual funds known as SIP (Systematic Investment Plan). Here a small amount can be invested on a monthly basis with the lock-in period varying from one year to three years.

  • Gold bonds
  • Instead of buying solid gold you can just buy gold bonds and do away with the worries of security and the fear of damage. You also save on the making charges which are otherwise levied each time you want to en-cash your gold. Not for people who prefer gold in its ornamental utility rather than as an investment.

    However, Mutual funds, SIP and Gold Bonds are sensitive to market changes, and so the returns may vary. The next three options provide you a stable investment option with guaranteed but lesser returns.

  • Retirement plans
  • Not everyone has a job which guarantees pension, and even if it does it might not be enough. A small amount invested monthly is all you need to start a retirement plan. Decide your probable date of retirement and calculate your present expenditure. Feed this data in one of the many available online calculators and calculate the monthly installments you need to invest starting today.

    Discipline is ensured as most retirement plans are set up with a payroll deduction. This is one of the most sought after and risk free modes of investment.

  • Goal oriented plans Insurance policies
  • Like retirement plans, there are various goal-oriented plans available in the market. Instead of your retirement date set the goal for higher education for children or marriage or any other venture. Many of these plans are linked with insurance policies to guarantee security for your family thus providing lesser returns but higher risk tolerance.

  • Fixed deposits
  • This one is an actual no brainer. This is not supposed to be an actual investment zone but just a place to park your money till you decide where to invest. Old timers would always sponsor this option.

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