4 BEST Investment Choices for Indian Businessmen with 15-25 lac income

As a successful businessman with an increasing income, your expectations of the lifestyle you want rise with your increasing profits, as does that of your family- maybe an education abroad, a home to call your own or even that swanky new sedan! When you’re savvy in all things related to your lifestyle, it’s important to be just as savvy when it comes to the investment options you consider, and the decisions you make about them- so you can comfortably maintain the lifestyle you and your family dream of! Here are 4 investment options, each with its pros and cons, which you can consider.

4 BEST Investment Choices for Indian Businessmen with 15-25 lac income

1. Mutual funds

mutual fund

A mutual fund refers to a pool of money managed by professionals to purchase securities. Mutual funds are seen as ideal investment options for people who don’t know too much about investments and money management as a professional fund manager oversees and takes a call on all your fund-related matters.

Pros

A major advantage of a mutual fund is diversification. As the funds are spread over different investments, your portfolio can be varied. This can be the additional advantage that if one specific security investment does not do as well as thought, it won’t have an effect on the overall portfolio as there are multiple investments made.

Cons

Mutual funds are subject to market risk. So they can be heavily dependent on the performance of the securities in the market. Another factor which can work against you is the share price calculation, which is the process of calculating the mutual fund share prices only once a day. Therefore if you are looking to put a sell or purchase order on a mutual fund, you have to wait till the share prices are announced and can’t really take advantage of the market as and when the individual stock prices rise/fall in realtime.

2. Real estate

Real estate

Real estate refers to any property that can be bought or sold. This includes both, commercial and residential properties.

Pros
The price of land rises each year (even if it only rises marginally, it still constitutes a profit). Also, since buying a house is a fairly large item on most people’s checklist, this investment option helps you kill two birds with one well timed stone.

Cons
If there is an emergency, your investment in real estate may not help that much as it is not considered a liquid asset. It takes a fair amount of time to sell property and if you need money within a short span of time, this will not be the most helpful investment.

3. Bonds

ULIPs Or Endowment Plan- Which is Right For You?
ULIPs Or Endowment Plan- Which is Right For You?

Bonds are essentially a form of debt. If a company issues investment bonds, they are basically borrowing money from you and your investment is considered a loan that needs to be repaid over time.

Pros
The main advantage of investing in a bond is that the interest rates that are offered as generally higher than those offered in other investment options. Bonds are typically controlled by the government, making them a fairly safe investment option.

Cons
A bond is normally a long term investment. If you want an investment option with a certain amount of liquidity, this is not the investment that will help you generate retruns in a short time span.

4. Unit Linked Investment Plans (ULIPs)

ULIPs Vs Fixed Deposits: The Right Way to Secure your Future Post Retirement

ULIP is a combination of investment and insurance, splitting the money invested into life insurance cover and investment in securities. ULIPs are one of the most sought-after investment options today as they offer an option pick between investing the equity market and the debt market. A ULIP that’s proven itself to be trustworthy and reliable, such as the HDFC Click 2 Invest, can offer high ROIs with lower risk factors, making it ideal for someone who earns anywhere between 15 lakhs – 25 lakhs annually. Click 2 Invest can offer you a sum of up to 10 times the annualized premium that you’ve invested, making it one of the leading policies to consider.

Pros
ULIPs can be operated as short term investments that can be made for as less a time span as 5 years. They are a transparent fund and give you the option to control exactly how the money is being spent.

Cons
They have a slightly higher premium than term insurance.

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