10 Best High Return Investment Options in India

Why is it important to invest?

Investment is important to have a financial security when needed. People invest in various forms to get good benefits from such plans. People save and invest money for a long time to have financial stability in the future. Investment and insurance components are together offered with investment plans that make it so important.

Investment plans are an ideal option for you if you want to invest and save taxes in the present and generate wealth for the future. Investments provide for security, financial independence, risk cover and tax benefits to your family even in your absence. There are two types of investment products- financial assets like market-linked products, namely, mutual funds and stocks, and fixed income products, namely, Public Provident Funds, Bank Fixed Deposits; and non-financial assets like gold and real estate.

Life insurance is considered to be the best investment option. Life insurance not only provides benefits to the policyholder but it also ensures security to the investor’s dependents or the nominees chosen. There are two types of investment options (financial assets) in the market: ULIPs – Unit Linked Insurance Plans that offers returns based on overall market performance; and Traditional Endowment Plans that offers maturity benefits as a one time or annuity payout.

Investment money and horizon, insurance goals, the risk that the policyholder may take up are the factors on which your selection of plan depends. In a stipulated time period, best investment plans in India fulfill your insurance goals.


You would want to invest your money where you will get best high returns as your benefits. In order to find the investment plan best suited for you with high returns, you need to consider a few parameters.

  • Tenure of the investment.
  • Risk appetite when you deal with stocks.
  • Taxation.
  • Liquidity in case of short-term investments is a priority.

Best Investment options:

Mutual Funds: One of the best type of high return investment is Mutual Funds. You can invest in medium or long-term of 5 to 10 years to receive best high returns. Investing in stock markets through mutual funds, nowadays, is a popular trend. People choose to invest in mutual funds who want to invest in equities and bonds that involve a balance of risk and returns. This investment option offers better returns compared to any other investment options in the market, with proper investment planning.

There are two types of mutual funds:

  1. Equity mutual funds- They predominantly invest in equity stocks. Equity funds are managed either actively or passively. In equities and equity related instruments, equity mutual funds schemes must invest at least 65 percent of its assets.
  2. Debt mutual funds- They are ideal for people who want steady returns. These are less perilous compared to equity funds, as these are less volatile. Treasury bills, corporate bonds, government securities, commercial paper, and other money market instruments are the fixed interest generating securities where debt mutual funds invest primarily.

Public Provident Fund: Amongst the best investment options in India, PPF is the safest and secured investment product. The money you invest is locked for 15 years under your PPF account in the bank or Post Office. From this account, you can earn compound interest and you can extend the time period for the next five years. In this option, the only hitch is that you can withdraw your money only after the 6th year, and in case of emergency, you can take a loan on the balance from this account. Since the tenure of the PPF is 15 years, the impact of compounding the tax-free interest is high. It is a safe investment option as the interest earned and the corpus invested is backed by sovereign guarantee.

Bank Fixed Deposits: One of the safe options for investment plans in India is a bank fixed deposit. They offer fixed returns for the investment tenure, which makes it a popular fixed income providing investment option. According to the guidelines of the bank, returns are payable monthly, quarterly or annually. Depending on what the bank offers, FDs offer options that are cumulative or non-cumulative. In the cumulative option, the interest is again invested within the FD and is payable at maturity. As per the approvals, the interest is paid in the non-cumulative option. Interest rates of FDs are high and FD investments can be made online or by visiting any branch of a bank. FDs are custom made plans and investors can choose the tenure of the plan.

RBI Taxable Bonds: The bonds are issued in Demat form and credited to the Bond Ledger Account. The bonds are issued at a price of Rs.100 and as a proof of investment, a Certificate of Holding is offered to the investor. These come with a tenure of 7 years, offering an interest of 7.75% p.a. The bonds offer assured returns with complete safety of the principle amount invested. You can opt for either the non-cumulative option where you will receive the interest or the cumulative option where the interest will be reinvested.

Senior Citizens’ Savings Scheme: This is one of the first choices of investment options for most retirees for being risk free and tax saving. The scheme can be availed by investors above the age of 60 in any post office or certified bank. This is a scheme for senior citizens and retirees only. The tenure is five years and can be extended for another three years after the maturity of the initial scheme. It is payable quarterly and is fully taxable, offering an interest rate of 8.6% p.a.

National Pension System: It is an initiative taken up by the government that aims to provide pension solution. It a long term retirement focused investment plan. Bonds, equity, government securities and investment alternative are where the fund invests as per the will of the investor. The NPS offers two choices: Auto, where the funds are automatically invested in different assets; and Active, where the investor makes the choice of the area of investment. The scheme matures when the investor turns 60. In this scheme the interest accumulated is tax free. On maturity if the investor avails the whole amount, 40% of it is exempted from taxes, however, if the investor chooses pension after maturity, like regular income this will be taxable.

Direct Equity or Share Purchase: It is one of the best investment options available but you must be well aware of how to analyze share stock, and the correct timing of your entry and exit. Compared to all other assets, equity deliver more than inflation-adjusted return. It will give you higher returns if your investment is for a long term. At the same time, unless you opt for stop-loss method to curtail losses, the risk of losing a significant portion is high.

Post Office Saving Schemes: In India, this is one of the best investment options that ensures high returns. It is a government saving scheme that involves low risk and the interest is low. There are plans to choose from, retirees have the option to choose their plans during their work life in order to receive regular income post retirement.

Real Estate: The house you live in might not be an investment but if you buy a second house or land, it is investment. The single most important factor in determining the value of your property and the rental it can earn is the location of your property. Real estate investment offers returns by rentals or capital appreciation. In India, it is one of the best investment plans as the value of property increases within 6 months of purchase.

Gold: High cost and safety are concerns that come along with possessing gold in the form of jewelry. The value of gold increases quickly, thus, it is one of the oldest and evergreen investment option. The making charge of jewelry itself is 6-14% of the cost of gold and may even rise up to 25% for exclusive designs. However, you can innovatively buy minted coins. An alternate way to own paper gold in a cost effective manner is through Gold ETFs. Another option to own paper gold is to invest in Sovereign Gold Bonds. You can opt for other gold investment option like Gold Deposit Scheme, gold bar, gold mutual fund, etc.

Bottom Line:

With such a wide range of convenient investment options, you need to evaluate them with respect to your financial goals and objectives. If you are looking for a safe investment in the long term perspective which creates wealth as well as protects your dependents and secures your post retirement life, life insurance is the safest bet. If your goal despite being long term with built in safety, reasonable returns but at the same time offers easy liquidity, Bank and Post Office investment could appeal to you. If you are moderately ambitious expecting good returns, Mutual Funds could be your chosen investment. On the other hand if you are overly ambitious in returns being the sole criterion, you could opt for Share Trading and the Equity Market. It all boils down to your financial strategy and aspirations. There is a solution for all types of aims that you want to pursue with your investments.

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