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Best Investment Plans for Upper Class

Written by - Akshatha Sajumon

February 9, 2022 5 minutes

Financially well-off individuals are well-aware of the importance of investing and constantly seek to multiply their sources of income. Therefore, designing a thorough investment plan becomes crucial as it helps in systematic wealth creation.

High Risk Instruments

  1. Stock Market

Promised with returns in the range of 15 to 18%, investment in equities is a good form of investment for those who have a high risk taking appetite. Individuals who are financially well off are capable of bearing a greater amount of risk as they already have a financial cushion in place to take care of their basic needs if something were to go amiss. These stocks however, must be held for a considerable amount of time, in order to mitigate losses and overcome market risks.

However, investing directly in stocks requires a lot of research and also needs the investor to be aware of the possible risks involved in investing in individual stocks.

  1. Equity Mutual Funds

Equity mutual funds, with their diversified portfolio, provide excellent returns in the long run. There is no risk of concentration and the asset management company invests in a range of stocks across different market capitalisation.

Equity mutual funds cater to all risk appetites – Index funds work well as a passive investment option, large cap funds are for the risk averse. While mid cap funds, small cap, international funds or focussed funds work for those that are open to taking a little higher risk for better returns. 

Moderate Risk Instruments

  1. Fixed Maturity Plans

Fixed maturity plans, or close ended mutual funds, are debt funds that invest in fixed income instruments such as certificates of deposit, bonds etc. the portfolio has a mix of only high rated securities and is a safe investment. These plans have a lock in period of 30 days to 5 years to eliminate interest rate fluctuations faced in the debt markets. The interest earned is more than fixed deposits and one even enjoys tax benefits by virtue of indexation. But they are not very liquid, which is a point you should consider while investing

  1. Debt Funds

Debt mutual funds that invest come in different varieties to meet your investment needs, risk appetite and investment horizon. These mutual funds invest in various fixed income securities like certificates of deposits, treasury bills, corporate debt, commercial papers, etc  with a maturity period of overnight to years.The main investment objective of debt funds is preservation of capital and high liquidity of funds. It offers returns better than the FD and assumes less risk in relation to equity funds. 

  1. Corporate Deposits

Also known as fixed company deposits, corporate deposits, though similar to bank deposits in a lot of ways, offer much higher returns than bank deposits. These are unsecured deposits that have a small risk attached to it. The reliability of these deposits can be gauged with the help of rating agencies such as CRISIL etc.

Low Risk Instruments

  1. Public Provident Fund

A secure investment backed by the government, the Public Provident Fund is exempt from taxes for all stages of investment. PPF offers a higher rate of return than regular savings bank accounts. The minimum amount that is to be invested is Rs. 500. Investors can choose to put in a maximum of Rs. 1,50,000 per annum. The investment is locked in for a period of 15 years that is extendable for a period of 5 years after that period. Partial withdrawals are allowed for pre-determined reasons after 7 years.

  1. Bonds

Offered by government and large corporations, bonds are debt instruments that are long term investment tools with fixed or floating interest rates. These financial instruments promise stability in investment and lesser risks but the interest earned is not as high as its equity counterparts. They offer a regular source of income to otherwise idle funds and there is usually no TDS that is deducted for the returns generated from these instruments.


Diversification of one’s portfolio in the different types of market instruments available is a good idea as it will ensure that risks are diffused and overall return earned is high. The balance or the portfolio mix must be arrived at after careful consideration of one’s risk appetite and the returns expected.

Frequently Asked Questions

  1. What are the most important considerations to be kept in mind while creating an investment plan?
    Clarity in financial goals, 
    Time horizon of the investment i.e. the timelines associated with it, 
    Current expense to saving ratio,
    Future expense to savings ratio, 
    Contingencies for which some savings have to be set aside 
    Alternate options available.
  1. What are the advantages of investing in government schemes?
    There is little to no chance of default as there is sovereign backing to the scheme.
  • There are multiple tax benefits available.
  • Most schemes have a fixed rate of return, securing one’s financial interests.

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