How to Invest as a Beginner: A Complete Guide

To find the best option for investment as a beginner, build your knowledge base and understand your risk appetite. For the best results, strive to strike a balance between secure investments and diversification. Depending on your investment horizon and risk appetite, you can consider a wide variety of instruments available in India.

As a beginner, you will require a dynamic strategy based on your ever-evolving financial aims and circumstances. 

Top Investment Options in India: 

Real Estate 

It is one of the best option for investment and the most popular choice offering growth and wealth-building opportunities. It is a trusted choice as it has given stunning returns over the years. There are numerous options available to you, such as:

• Investing through REITs
• Buying a commercial property
• Investing in a residential property

While there is no minimum limit or maximum cap, remember that you may need a large sum for the initial investment. Returns may vary depending on the market value and location. Like every investment option, it has its own set of risks and drawbacks.

For one, it’s difficult to liquidate by finding the right buyer and selling the property. In case of a rush, you may have to sell it at a highly discounted value. Nevertheless, in most cases, it gives some of the best returns on investment.

National Pension Fund 

This is a contribution scheme which works both as a savings and a retirement fund. It is market-linked, has gained more demand over the years and is recommended among top investment options today. The government is adding improved features and benefits to encourage more investors, making it a lucrative option. 

It offers you:

• Tax benefits
• Regular pension income

You can choose where you want to allocate your assets. However, it is crucial to note that in NPS, the maximum equity allocation can be 75% by the age of 50 years and it has a lock-in period. 

Also Read: Tax Benefits Under NPS

Government Bonds 

To encourage more investment in sovereign bonds, the Government of India offers direct purchase of bonds to investors. Both state and central governments issue these bonds.

• The bonds issued by the state government are state development loans
• The bonds issued by the central government are referred to as G-sec or simply government bonds

Yon needs a bank account and a demat account to hold a government bond, similar to any other investment. If you are looking for a relatively secure and best option for investment, consider this. 

You can also invest in government securities through mutual funds. The maturity period can be three years or more, depending on the offering. Taxation on government bonds works based on your income bracket and applies to the interest-generated bond. It has a fixed return throughout the bond’s life cycle till the maturity period. All these factors make it one of the best options to invest in India.

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Sovereign Gold Bonds 

To access this kind of investment, you don’t need to buy physical gold as an underlying asset. If you are looking for an investment with higher returns, this may be the ideal one for you. It is issued by the RBI at regular intervals through both public and private sector banks. You can also invest using your demat account. It has a maturity period of 8 years. 

For individual investment, you can invest up to the price of 4 kgs of gold. Interest earned on SGBs is taxable, whereas the maturity amount is exempt from taxation. It has low to medium risk, making it one of the best options to invest in India.

Considering the increasing inflation rate, choosing an investment with higher returns can be a smart choice. Investing is built on a bedrock of savings, which you can boost through a smart financial tool like the Fibe Axis Bank Credit Card. It is India’s first numberless credit card and gives you Enjoy 3% cashback on your transactions. 

It also links to your UPI ID, so it gives better security against credit card fraud and identity theft. 

You can get access to domestic airport lounges and fuel surcharge waiver discounts, too. Download the Fibe App or register on our website to get the Fibe Axis Bank Credit Card today!

FAQs on Top Investment Options for Beginners 

What are the risks associated with beginner investments? 

For beginners, choosing the best ROI investments can be difficult. It is with experience and knowledge that you can build a successful and profitable investment portfolio. Some of the risks you may face are losing your capital, letting your emotions get in the way of long-term investments and pursuing trends without understanding market dynamics. 

Should I invest in stocks or mutual funds as a beginner?

It may be more appropriate to invest in equity mutual funds as a beginner since the fund manager has experience in allocating your investment to the right stocks and sectors. 

Should I diversify my investment portfolio as a beginner? 

Yes, you can diversify your portfolio in terms of maturity period, tax savings, risk exposure and other factors and get the best returns for investment.