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What are the investment options for self-employed?

By: Makemymoney

Investment for a self-employed person is as important as for the non-government employee. Saving in any which ways are a very beneficial investment. Self-employed is a solo army with irregular income and so they are entirely on their own to secure their post-retirement future. In this blog we will discuss, what are the investment options for self-employed?. Saving plays a vital role especially at the time of money requirement. Also, one must need to save some amount of their earning on a regular basis.  Let’s discuss investment plans for self-employed.

Bank Fixed Deposit

Bank fixed deposit is a nice scheme from an investment point as it’s a short-term fixed deposit. Small banks offer the highest card rates, ranging from 8-9%. Similarly, private sector banks offer the highest card rates in the range of 7 to 8.25% per annum. The highest card rate offered by public sector banks fall short of 7 percent only. However, senior citizens get an additional interest rate of up to 0.50% on their fixed deposits.

In case of if there is a premature withdrawal then bank deducts 1% from the original booked rate or from original card rate depending on whichever is lower. These can substantially reduce your FD return, opt for FD only if you are certain to continue with them till it’s maturity.

Equity Mutual Fund

Equity MF invests at least 65% of their corpus in equity shares. Being invested in equities, these funds outperform other investment options for 5 to 7 years of duration. There are investment planners, who track market movement and investment opportunities, and they guide properly how to invest for getting good benefit. They instruct less risky investment plans, who wish to invest in a stock. One of the best investment options for self-employed.

Equity Linked Saving Scheme:

One can invest in ELSS up to Rs. 1.5 lakh per annum for a tax deduction. This is applicable under section 80C. It has the lowest lock-in period that is off 3 years only. This is the lowest locking period among all investments. This investment plan has beaten most of the tax saving alternatives for the period of 5 years.

National Saving Certificate:

National Saving Certificate or NSC is a post office based product for saving money. It offers a good interest rate, you can buy NSC in multiple of Rs. 100 every month for 5 years. This is the minimum contribution and interest rate offered is 8.1%. Also, there is no text deduction and an invested amount is tax deductible under section 80C. National Saving Certificate won’t allow premature withdrawal of amount.

Public Provident Fund:

This is another popular long-term investment in India. The Government of India manages Public Provident Fund accounts. Currently, PPF is paying 8% per annum on its investment. The amount invested is tax deductible under section 80C while the maturity proceeds and interest income from are tax-free. It’s a good investment plan with a lock-in period of 15 years. Another best investment options for self-employed

 

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