Where to Invest Your Money in India – Best Investment Options for You in 2022

The last couple of years weren’t much of a success for practically anyone (unless you’re a hotshot). 

If the pandemic has taught us anything, it’s the value of money.

People who were disciplined financially found it easier to sail through the hard times than the ones who rarely saved. 

Saving for the future has traditionally been a habit for us Indians but the last two decades – full of glitz, glamor and an increase in the number of ways to spend money on has made many youngsters forgetful about the saving habit they’ve seen their parents follow religiously. 

Well, the old ways of saving money – keeping cash in lockers, buying gold or putting it in FDs and LICs won’t even work in our world. But this doesn’t mean you should stop saving money for your future. 

“But where should I invest my money to get decent returns without much risk?” a question that’s asked by every youngster who is looking for financial independence. 

In this blog, we’ll cover a few ways to invest your money in India that will help you start your investment journey. 

Best Investment Options for 2022

If you’ve been all over Google finding the best way to invest money online in india, let me tell you one thing: you won’t find the best opportunities lying around the internet. 

You can opt for any investment avenue or option wisely and a build fortune if you follow some simple rules: 

  1. Be Consistent in Your Investments 
  2. Track Your Investments & Returns 
  3. Create a Goal-based Financial Plan
  4. Don’t Run after Assets You Don’t Understand Just Because of Tips 

Enough said about financial discipline, let’s look at some evergreen avenues, things to keep in mind and how you should get started. 

  • Invest in Stock Markets 

“The stock market makes fortunes.” 

By now you’d have heard this millions of times. Well, yes that’s true. In fact, equities are one of the best performing assets over the last few decades. 

Over the last 30 years, Sensex has grown over 100 times – from 442 points in 1987 to 50,000+ in February 2021. 

This means if you’ve invested just INR 10 lakh in the stock market (SENSEX), it would have grown to more than 10 crore during this time.  

Around the world too, equities are seen as a viable investment opportunity with massive growth. 

What to Expect?  

If you’re thinking of investing in the stock market, you need to be prepared well- both on paper and mentally. 

Remember, the stock market is an active market that doesn’t always go up (well, yes, always in the long term). If you always look for short term gains, you have to really plan well and know where you’re investing (through technical or fundamental analysis). 

Remember, stock market is a volatile asset class, which means there’s no guarantee of returns and you would have to be an active participant in the process of investing. 

So, if you are not aware of the financial world, or can’t get a hang of the concepts, you should first learn about the stock market before proceeding with an investment decision. 

You shouldn’t trust any ‘tip’ or suggestion blindly and stay prudent at all times, else you can suffer losses in the short term 

Avenues to Invest & Grow Your Wealth in the Stock Market 

  • Primary Market – IPO allotment 
  • Secondary Market – Buy/Sell Shares, Intraday Trading, etc. 
  • Future & Options 

Resources to Help You Get Started:  

Best Demat Accounts in India
Mistakes not to Do as a Beginner in Stock Market 

  • Mutual Fund Investments 

This is the posterboy for investments in India in the last one decade. Remember those ‘Mutual Funds Sahi Hain!’ Ads on TV? 

Over the last few years, there has been a spike in mutual fund investments in the country. 

By now, I don’t think I have to tell you about the concept of mutual funds. But it is definitely a great way to invest your money, especially through the SIP route, if you want to gather wealth in the long run. 

There are several kinds of mutual funds- equity funds, debt funds, exchange traded funds, etc. You must have basic knowledge of the ecosystem and should invest in a fund that is suitable for your risk profile and short/long-term goals. 

What to Expect 

Investing in a mutual fund is relatively simple than directly investing in the stock market, thanks to the AMCs who appoint fund managers to take care of portfolio selection. 

But, you still the onus of choosing the right AMC lies on your shoulders. 

Don’t just blindly go on to invest in funds which have shown the highest returns in the past (those numbers are historical figures and might not repeat again), but take an active interest in choosing an AMC and a fund with solid goals, AUM and a track record of consistency over the years. 

Also, it is better to invest via the SIP route, especially in the case of equity mutual funds as this will give you the benefit of rupee cost averaging and compounding over the years. 

Avenues to Invest 

  • Equity Mutual Funds
  • Debt Mutual Funds

Resources to Help You Get Started 

Invest in Cryptocurrencies 

This asset class is behaving like the hottest chick in the town these days. Everyone seems to take a sudden interest in cryptocurrency investment. 

From the story of Bitcoin billionaires to Elon Musk’s ‘To the moon’ stunt for Dogecoin, this space took the fancy of millions of people around the globe, especially on social media. 

As per Investopedia, there are more than 4000 cryptocurrency tokens, at present.  (Yes, it’s not just limited to Bitcoin or Doge). 

This is the reason, you should be careful with this asset class. Though, it appears it can make you a millionaire overnight, but there is literally no guarantee, past data or reasoning to the crypto domain. 

Still, if you want to invest in bitcoins and other altcoins, be very sure to limit your exposure to an amount that you can afford to lose. 

What to Expect? 

Cryptocurrency as an asset class is quite young and you can’t expect a lot of reasoning or data to support your investment ideas. But yes, this asset class is hot, especially because of the Bitcoin rally in the past one decade. 

The essence of crypto is basically anti-establishment and in the power of decentralization. So, you can ride the rally by risking a portion of your expendable earnings, if you are bullish on a few tokens. 

But beware, don’t increase your exposure and think of it as a space with a predictable path. India has already taken stringent measures multiple times to block cryptos and cryptocurrency investments and there’s still no clear regulation. So, tread carefully! 

Avenues to Invest 

  • Bitcoins, Ethereum, Dogecoin, and 4000+ other crypto tokens 

Resources to Help You Get Started 

  • How to invest in cryptocurrencies in India as a beginner? 

Low-Risk Investment Options in India – Safe, Secure and Trustworthy 

Okay, enough on the investment options that might be making your heart scream – risk. 

No matter how many times anyone tells you the benefits of calculative risks, your heart will always look for options which are safer. So, here are a few investment options that are considered low-risk in India:  

High-yield savings accounts | Savings bonds | PPF & National Pension Scheme  | Certificates of deposit | Money market funds | Treasury bills | Corporate bonds | High dividend-paying stocks | Fixed annuities

Keep in mind that you should not go into temptation of adding only low-risk investments to your portfolio because these often come with low returns too (mostly less than the inflation rate). So, you won’t grow your wealth over time by just playing it safe. If you want to create wealth over the years, you should invest based on your investment risk profile. 

Always remember, the propensity to take risks reduces with age. So, if you’re young, you can add more risky investments to your portfolio and vice versa. So, make a decision accordingly. And more importantly, always take advice from a registered financial advisor before investing anything. 

Final Thoughts 

India as an economy offers several opportunities for investors, young and old. It’s important you choose the right investment options and start a goal-based financial plan for yourself. 

Remember, the early you invest, the more you’ll accumulate. So, don’t keep delaying your decision to invest and choose an instrument to begin your investment journey now. 

And while you’re here, check out our article on how to start investing as a beginner in India today.

This blog is a part of MoneyNMotivation’s Financial Investment Series 

Disclaimer: I am not a certified financial advisor. I share my experience and you should consult a financial advisor before making any financial decision.  

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