Invest Money

How to Invest Money – A Guide to Grow Your Wealth in 2019

Everyone wants to know how to invest money to grow the portfolio and generate a higher return. However, the same cannot be achieved without making a due analysis of the purpose of investment, available time horizon and risk appetite of the individual.

Many investors only look for a higher return, but forget the importance of the liquidity of the fund. Ideally, you should spread your investment across different asset classes to get an optimum outcome from your investment.

You can invest in FD, mutual funds, stocks, public provident fund, gold or real estate as per your short term and long term life goals.

Invest in FD

Fixed Deposit is the choice of every investor in India. The reason behind the obvious choice is the guaranteed return and safety of the principal. Usually, investors chose the banks for the safety of their fixed deposits.

However, the rate of return is very low in bank FDs. As compared to the bank FDs, you can get a better rate of return if you invest in FDs of NBFCs (Non-Banking Financial Companies).

The problem with NBFC FDs is, you need to find out reputed NBFCs that you can rely on. The best way to evaluate NBFC FDs is ICRA rating.

Apart from credit rating, you should also check the record (at least for ten years) of the repayment history of NBFCs to safeguard your investment as good as bank FDs, while enjoying higher interest rates.

Mutual Fund

Nowadays mutual fund investment has drawn the attention of the investors. In the long run, equity mutual fund investment has the potential to generate a high return. You should not invest it for short term life goals or emergency.

For such a purpose, a fixed deposit is the better options. If you want to invest in equity mutual fund, it is advisable to invest in fixed deposit first, before evaluating other options.

Usually, equity mutual fund requires the time horizon of ten years or more to generate higher returns; however, the same is not guaranteed.

Public Provident Fund

If you want to generate long term corpus with the safety of the capital, the Public Provident Fund(PPF) is the ideal option. The return from PPF is tax-free in the hand of investors. The PPF account is opened for a duration of 15 years.

After 15 years, you can withdraw the entire amount tax-free. You will have an option to extend the account for the block of five years.


The return from equity is much higher than smart investment options. provided you have invested in the right stock at the right time. However, the selection of ideal stock and timing requires professional expertise and full-time engagement with the stock market.

If you can’t devote the time and investment, you can lose your principal amount by generating negative returns. Moreover, investment in equity is always subject to market risk due to unforeseen factors.

Before you invest in equity, make sure to have sufficient emergency fund that you can access with ease irrespective of market fluctuations.


From ages, Gold is considered a safe haven for investors because it covers sovereign risk as well.  You can invest a small portion of your investment in Gold to give diversity to your portfolio.

The biggest drawback of gold as an investment is, it cannot generate regular income. The value of gold is almost stable for several years. Hence, it does not serve the purpose of wealth creation. It is recommended to invest only five per cent or lesser proportion in Gold. 

Which Investment option in better?

Diversity is the key to any investment. Even before you diversify your portfolio, make sure to give priority to meet the emergency need in case of illness or accidental hospitalization or any other unforeseen financial commitment.

Fixed deposit is an ideal investment option for such purpose. It protects your capital amount and ensures pre-committed return. If you are a retired person, the fixed deposit can give you regular monthly income.

You can use online FD calculator to know the amount of interest income for the principal amount, rate of interest and duration of FD. Once you have sufficient FD, you can explore other investment options.

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