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What is the Meaning of Long Term Investments?
Long term investments are financial assets that individuals or organizations acquire with the intention of holding them for an extended period, typically several years or even decades. The primary objective of long term investments is to build wealth, generate income, or achieve specific financial goals over time. In fact, there are several long term investment options in India.
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Best Long Term Investment Plans in 2024
1. Public Provident Fund (PPF)
The Public Provident Fund (PPF) stands as a top-tier option among long term investment schemes, offering government-backed assurance. PPF emerges as a premier choice for individuals seeking secure, government-guaranteed, long term investment opportunities. Here are the key details:
Know more PPF
2. Employee Provident Fund (EPF)
The Employee Provident Fund (EPF) stands as a prime choice for retirement savings, with a portion of your earnings directed into a provident fund that accumulates interest over an extended period. Here are the key details:
3. Mutual Funds
Mutual funds emerged as top-tier long term investment plans with high returns within the Indian landscape, bringing together investments from a multitude of individuals to construct a diversified portfolio encompassing bonds, equities, and a range of other securities.
4. Fixed Deposits
Investing in fixed deposits through banks presents itself as a sound investment strategy, recognized for its reliability and attractive returns within the Indian context.
5. ULIPs (Unit Linked Insurance Plans)
Unit Linked Insurance Plans (ULIPs) are also another long term investment plan with high returns. It represents another compelling investment option within the Indian financial landscape. ULIPs seamlessly integrate insurance and investment, offering both life coverage and attractive investment prospects. They are tailored for long term wealth growth.
6. National Pension Scheme (NPS)
The National Pension System (NPS) stands as an attractive long term investment plan or one of the best long term investment opportunities for generating substantial returns. This voluntary pension scheme assists individuals in building a retirement nest egg by offering market-linked returns and associated tax advantages.
7. Stocks
Directly investing in the stocks of publicly traded companies presents an opportunity for potential growth in capital value alongside the prospect of receiving dividend income. It is one of the best long term investment opportunities.
8. Real Estate
Real estate is one of the best long term investment plans with high returns. Investing in real estate emerges as a premier choice among long term investment strategies, promising substantial returns and ranking as one of the most lucrative investment plans. Dabbling in residential, commercial, or rental properties offers the potential for capital appreciation and a steady rental income stream.
Real estate constitutes a top-tier option for sustained, long term investments, with returns that tend to grow over time.
9. Gold
Investing in gold ranks among India’s top-performing long term investment plans, known for its potential for robust returns. Allocating funds into gold or other valuable metals serves as a safeguard against the eroding effects of inflation and the uncertainties of the financial market.
10. Equity Funds
Equity funds in India stand out as one of the premier long term investment options or the best long term investment in India. These funds pool money from investors and invest in a diversified portfolio of stocks. With a recommended investment horizon of five years or more, equity funds offer the potential for substantial capital appreciation over time. They are known for their ability to outpace inflation and deliver attractive returns, making them an ideal choice for individuals looking to build wealth over the long haul. .
Comparison of Different Long term Investment Plans in India
Which is the best long term investment in India or long term investment opportunities? Where should I invest my money? The following are some of the best ways to invest money in India.
Investment Option | Risk Level | Potential Returns | Liquidity | Suitable for |
Fixed Deposits (FDs) | Low | 4%-8% | Varies depending on the terms | Conservative investors looking for capital preservation and regular income |
Public Provident Fund (PPF) | Low to Moderate | 7.1% | Low (lock-in period of 15 years) | Individuals seeking tax-efficient, long term investments |
ULIPs | Medium to High | 12 percent | Moderate (5 years) | Individuals looking for insurance coverage along with investment opportunities. |
Mutual Funds | Varies (based on fund type) | 6%-9% | Moderate to High (depending on fund type) | Investors seeking professional management and potential for higher returns |
National Pension System (NPS) | Moderate | 8%-10% | Low to Medium (withdrawal restrictions apply) | Individuals planning for long term retirement |
Stocks | High | 6.6% | High (can be bought and sold on stock exchanges) | Investors with a higher risk appetite and a long term investment horizon |
Equity Funds | High | 5 to 15 percent | Moderate to high | Investors seeking long term capital appreciation are willing to tolerate moderate to high risk. |
Real Estate | Moderate to high | 10 percent | Moderate to high | Best for individuals seeking passive income |
Gold | Moderate | 12% | Moderate (depending on form of investment) | Individuals seeking a hedge against inflation and currency fluctuations |
Why Opt for Long Term Investments?
- In contrast to short term investment strategies aimed at capital preservation, long term investments are designed to foster wealth creation.
- They involve constructing an investment portfolio that generates income over an extended period, serving purposes such as retirement planning or achieving long term financial objectives. Accumulating wealth becomes crucial to ensure a comfortable future, sustaining the income levels required.
- Nevertheless, long term investments entail a degree of risk, often encompassing equity investments, ULIPs, and similar options. While riskier, these investments offer an opportunity to recover from market fluctuations over the extended holding period.
- While they may experience downturns of up to 20% in the short term, they can potentially yield double-digit returns over a 10 to 20-year horizon. On the other hand, assets with lower risk provide more predictable but slower returns.
- Hence, when contemplating long term goals, it’s essential to weather short term fluctuations for the sake of achieving desired returns.
Common Long term Investment Plans Financial Objectives
Investing for the long term serves various purposes, including:
- Funding Children’s Marriages
- Financing Higher Education for Children
- Purchasing Property or Land
- Planning for Retirement
One significant advantage of long term investment plans is that they enable you to cover future expenses with accumulated funds, often with tax-saving benefits. However, in some cases, returns may become taxable beyond a certain threshold. Additionally, if you resort to loans to meet long term goals, you may incur interest charges typically ranging from 8 to 10%.
Curious about the best long term investment plans for 2024 or the best long term investment options? Below, we highlight some top choices:
- In the quest for financial security and wealth accumulation, choosing the right long term investment plans is paramount. India offers a diverse range of investment options that cater to the needs of those who seek to grow their wealth steadily over an extended period.
- Whether you’re planning for retirement, your child’s education, or simply looking to build a financial cushion for the future, understanding the best long term investment plans in India is essential.
- In this guide, we will explore some of the top investment avenues that can help you achieve your long term financial goals while navigating the intricacies of the Indian investment landscape.
- However, if you are seeking the best short term investment plans with high returns in India, especially in the realm of fixed income, consider exploring the real estate market. One particularly enticing option within this domain is structured debt investments, with a specific focus on the commercial real estate sector.
- These structured debt investments in real estate entail customized financing solutions tailored to suit commercial real estate projects. They present investors with the prospect of potentially securing attractive returns and regular income streams.
- What’s notable is that entry into this investment avenue is accessible with a relatively modest initial investment of 10 lakhs, and it holds the potential to yield returns ranging from 12 to 20%. These investment opportunities are made available through well-established alternative investment platforms like Assetmonk.
Bottom Line
You have the option to allocate your funds to any of the previously mentioned best long term investment plans or schemes to facilitate long term wealth accumulation. However, before embarking on your investment journey, it is crucial to seek guidance from a financial advisor who can assist you in managing your financial portfolio effectively. You can explore online resources, analyze market data, review historical performance, and even delve into the experiences of fellow investors to arrive at well-informed investment decisions. This approach will empower you to make prudent investments that align with your predefined financial objectives and pave the way for achieving them.
Assetmonk distinguishes itself as an outstanding alternative investment platform in India, presenting a diverse range of appealing options for astute investors. Within these opportunities, individuals can delve into the domain of structured debt investments within the commercial real estate sector and a carefully curated assortment of alternative investment selections.
Assetmonk offers exclusive and customized investment possibilities to its esteemed clientele, with a minimum investment requirement of 10 lakhs and a guaranteed Internal Rate of Return (IRR) of 17 percent.
Related Articles
- Best Short Term Investments With Higher Returns
- Structured Debt Backed by Real Estate vs. Debt Mutual Funds: Exploring Risk and Yield Potential
- Best Investment Options in India to get Higher Returns
FAQs
Q1. What are Long term investments?
A. long term investments are financial assets that individuals or organizations acquire with the intention of holding them for an extended period, typically several years or even decades. The primary objective of long term investments is to build wealth, generate income, or achieve specific financial goals over time.
Q2. What are some of the best Long term investment plans in India?
A. Some of the best long term investment plans in India are real estate, gold, EPF, PPF, and NPS.
Q3. What should I invest in for Long term gain?
A. You can invest in ULIPs, stocks, real estate, PPF, and EPF for long term gains.
Q4. What makes a good Long term investment?
A. A good long term investment typically possesses several key attributes. It should offer the potential for capital appreciation over time, be aligned with one’s financial goals, and provide diversification to spread risk. Additionally, a good long term investment often offers some form of income generation and demonstrates resilience in the face of market fluctuations.