Due to global economic downturns, there has been a surge in NRI investment in recent years. Indians working abroad are suddenly concerned about the security of their jobs and the investment opportunities available on foreign soil. However, many questions arise in people’s minds about the best investment options in India. Every investor wants to invest in the Best Investment Options in India to earn the highest possible return in the shortest possible time with the least amount of risk. Some people invest because they require financial security, while others invest to achieve specific investment objectives. Your investment options should get determined by your risk tolerance, investment horizon, financial goals, and liquidity requirements.
It is why many investors are always on the lookout for the best investment options in India, where they can multiply their money in a short period with little or no risk. However, it is difficult to find an investment strategy that offers both high returns and low risk. In reality, returns and risks are directly proportional to each other, which means that the higher the risk, the greater the likelihood of a return. Investment options get divided into two categories: financial assets and non-financial assets. Financial assets can get further subdivided into market-linked securities such as mutual funds, live stocks, and so on, and fixed income products such as bank FDs, Public Provident Fund (PPF), bank RDs, and so on. Non-financial assets include gold investments, real estate, and treasury bills.
Now, what are the best investment in India for NRI with returns?
Some of the best investment options in India 2022 that offer high returns are listed below. You must incorporate these investment plans into your financial portfolio while saving for the future. We will also compare investment options in India and their returns.
Investment Options | Period of Investment (Minimum) | Who Can Invest? | Risks | Return |
Real Estate | 5 years | Anyone | Medium | 15-19% |
National Pension Scheme (NPS) | 60 years | An investor anticipating retirement plans | Low-High | Market-linked ( 8- 10%) |
Public Provident Fund (PPF) | 15 years | Long-term investment goals | Nil | 7.9% |
Mutual Funds | A three-year lock-in period gets required for an ELSS scheme. | An investor who is willing to take on medium to high risk. | Low-High | Market-Linked |
Direct equity | NA | An investor who understands how to balance risk and return | High | NA |
Fixed Deposits (FDs) | 7 days | Someone who does not want to take a risk or get exposed to equity. | Nil | Fixed Returns differ from bank to bank |
Gold ETFs | NA | Anyone | Low – Medium | Market-linked |
Unit Linked Insurance Plan (ULIP) | Less or equals to 45 years | An investor who is interested in both wealth creation and life insurance. | High | Depending on the investor’s profile |
Initial Public Offering (IPO) | NA | An investor should have a Demat account and a trading account. | Moderate-High | NA |
Let us now take a quick look at each of the best investment options with high returns in India 2022, one by one.
- Real Estate: Real estate is a popular investment option for NRIs due to the emotional value of owning property in India. You can invest in either residential or commercial real estate. Investing in real estate provides two benefits: regular income and capital appreciation. The average annual return from June 2010 to June 2020 was 11.6 percent. Your NRO, NRE, or FCNR account can get used to fund your property purchase. Real estate is a good investment because it provides good long-term returns and consistent growth over time.
Do not miss High Return Real Estate Properties For NRI Investments In India.
- National Pension Scheme (NPS): NRIs can also invest in the National Pension System. It allows investors to customize their asset allocation based on their risk tolerance. They can also select the auto option, in which the asset allocation gets determined by the investor’s age and gets rebalanced annually. If you have a PAN card or an Aadhaar card, you can open an NPS account and invest in the scheme using an NRO or NRE bank account. NPS investments are locked in until you reach the age of 60.
- Public Provident Fund (PPF): A Public Provident Fund (PPF) account investment is safe and government-backed for NRI. An Indian resident can open a PPF account and begin investing at any time. On the other hand, if an NRI does not already have a PPF account, he cannot benefit from this scheme. They cannot, under any circumstances, extend their Public Provident Fund Account after 15 years of the designated maturity period under the PPF Account for NRIs.
- Mutual Funds: You can invest directly in mutual fund schemes as an NRI. Mutual funds (MFs) can be a critical part of an NRI’s investment strategy. Mutual funds provide a diverse range of investment options, from debt to equity, and well-chosen schemes can produce high returns. You must have an NRE or NRO account to invest because you can only invest in Indian rupees. The rate of return gets determined by the type of fund you have invested, such as debt, equity, or hybrid. You must pay capital gains taxes on the returns you earn from mutual funds.
Do not miss Mutual Fund NRI Investment in India & Things To Consider Before Investing in Mutual Funds.
- Unit Linked Insurance Plan (ULIP): NRIs (Non-Resident Indians) have the same rights as any other Indian resident to invest in ULIPs (Unit Linked Insurance Plans) under the Foreign Exchange Management Act (FEMA). It is one of the most popular and dependable investment options. The main advantage of ULIPs is that they provide a dual benefit of investment and insurance, which ultimately aids in the creation of wealth if invested wisely over time. Another factor attracting NRIs to invest in ULIPs is the availability of tax benefits. ULIP premiums are deductible under Sections 80C and 10(10D) of the Income Tax Act of 1961.
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