How-to Build Wealth: Simple Investment Tips

May 23, 2024
Updated on

The All-India Aspiration Index has seen a remarkable rise to its highest point, reaching an impressive 87.3 since its inception in 2018. This figure is a significant jump from its lowest point of 79.9 during the pandemic year of 2020 and an even more impressive climb from 84.4 in 2021. This surge in the Index indicates that Indians are increasingly ambitious and committed to achieving their goals and aspirations, especially when it comes to upward social mobility. Finances are seen as a key factor for success, as it grants individuals the resources necessary to make their dreams a reality.

Dreams are something that everyone around the world strives to achieve in life. However, many of us think it is impossible to make enough money to realise these dreams and eventually give up on them. It is true that wealth cannot be created overnight, but it is still possible to accumulate wealth over time if you are diligent and disciplined when it comes to making investments. As you plan out your route and itinerary when you go on a long trip, you should create a plan or goal that outlines how and where your money will be invested, as well as a timeline and goals for achieving those investments. 

Goals are an essential part of life and can be classified into two main types: short-term and long-term. Short-term goals are those that can be accomplished within a timeline of 5 years or less. These could be things like home renovations, investing in property, or buying a car. Long-term goals are those that require more than 5 years to achieve, such as providing education for your children, marriage, ensuring financial security in old age, etc. After setting a goal, the next step is to research the different investment options available. By exploring the different financial markets, you can choose the best investments that will help you to achieve your desired outcome. With a consistent and dedicated approach to investing, you can turn your dreams into reality. There are different financial products that you can invest in, which we will cover in this article.

Top 9 Financial Products You Must Know About

Not all financial products are suitable for all goals. You need to select financial products which are suitable for your goals. Simple but powerful financial products you can use are :

1. Public Provident Fund

The Public Provident Fund (PPF) was launched in India in 1968 by the National Savings Institute of the Ministry of Finance to encourage small-scale savings and investment. It is a great way for individuals to save for retirement and minimise their tax bills. As an investment option, PPF provides a safe and secure environment with guaranteed returns, making it an ideal choice for those looking to save money and reduce their tax burden. With its long history of success and numerous benefits, PPF is an excellent choice if you are looking for a reliable and tax-efficient savings plan.

  • The scheme is offered by the Government of India
  • Anyone over the age of 18 is eligible to apply
  • The minimum contribution of this scheme is Rs 500 each year and the maximum contribution is Rs. 1.5 lakhs
  • There is no income tax on the PPF contribution amount and also no tax on interest earned in PPF
  • You can open this scheme at a bank or post office
  • This is a tax-free scheme and you can expect a 7.8% return per annum
  • The loan facility is available from the 3rd to the 6th financial year, allowing you to make withdrawals every year from the 7th financial year onwards. 
  • Upon completion of 15 financial years from the year in which the account was opened, the account is considered mature. 
  • After maturity, you have the option to extend your account for a block of 5 years with further deposits.

2. Mahila Samman Savings Certificate

Finance Minister Smt. Nirmala Sitharaman announced the Mahila Samman Saving Certificate in the 2023-24 Budget Speech to commemorate the Azadi ka Amrit Mahotsav. This one-time investment allows women and unmarried girls to deposit up to a maximum of 2 lakh rupees. The amount can be withdrawn after two years, but you can opt for the partial withdrawal facility in case of premature withdrawal. From April 2023, eligible girls and women can take advantage of this scheme until March 2025.

  • The scheme is offered by the Government of India
  • Any woman or girl above the age of 18 years is eligible to apply
  • The Mahila Samman Savings Certificate will be available for two years, from April 2023-March 2025. 
  • This scheme will offer a maximum deposit facility of up to Rs.2 lakh in the name of women or girls for two years at a fixed interest rate of 7.5%.
  • You can open it at any bank or post office from 1st April 2023

3. Sukanya Samriddhi Yojana (SSY)

The Sukanya Samriddhi Yojana is a government savings scheme designed with the intention to benefit girl children under the initiative called “Beti Bachao – Beti Padhao”. The parent or guardian of the girl child who is 10 years of age or younger can open an account under this scheme. This scheme carries a higher interest rate along with several tax benefits.

  • The scheme is offered by the Government of India
  • Parents of a girl child who is younger than 10 years of age can open the account. 
  • Only one account can be opened in the name of a girl child and one family can open a maximum of 2 SSY accounts.
  • Minimum deposit ₹ 250/- Maximum deposit ₹ 1.5 Lakh in a financial year.
  • Accounts can be opened in Post offices and in authorised banks.
  • Withdrawal shall be permitted for the higher education of the Account holder to meet education expenses.
  • The account can be prematurely closed in case of marriage of the girl child after her reaching the age of 18 years.
  • The account can be transferred anywhere in India from one Post office/Bank to another.
  • The account shall mature on completion of a period of 21 years from the opening date of the account.
  • Return expectation – 7.6 return p.a.

4. National Pension Scheme

The National Pension System (NPS) is a voluntary, defined contribution retirement savings scheme designed to equip citizens with the ability to make informed decisions about their futures. It provides a safe platform for systematic savings throughout life, encourages the habit of retirement savings, and offers a sustainable solution to the challenge of ensuring an adequate income in retirement. Investment options include Government Bonds, Bills, Corporate Debentures, and Shares, which are managed by PFRDA-regulated fund managers. The return on investment determines the growth of accumulated pension wealth over time. Upon retirement, subscribers can opt to purchase a life annuity from an empanelled Life Insurance Company or withdraw part of the accumulated pension wealth as a lump sum.

  • The scheme is offered by the Government of India
  • An Indian citizen aged between 18 – 60 years on the date of submission of his/her application can invest in this scheme.
  • Applicant must adhere to the Know Your Customer (KYC) requirements listed in the Subscriber Registration Form. All documents necessary for KYC compliance must be provided in full and submitted promptly. Failure to comply with KYC regulations may result in the rejection of the application.
  • The minimum contribution is Rs. 1000 
  • The National Pension Scheme has been a reliable source of retirement savings for over a decade, providing investors with a consistent 8% to 10% return each year since its initiation. This steady rate of return has enabled individuals to plan for their future with confidence and security, providing a secure source of income for their later years.
  • Applicants can open the account at any post office and all banks
  • The scheme provides investors with an opportunity to build their savings over time, as it permits them to continue investing until they reach the age of sixty. Upon reaching this milestone, they will be eligible to withdraw the entire corpus of their investment, giving them the peace of mind that their money will be available to them when they need it.
  • Applicants are obligated to maintain at least 40% of the total invested corpus in the NPS fund to earn a regular pension after their retirement. However, they are eligible to withdraw 25% of the total corpus for certain purposes after they have invested in the pension fund for a minimum of 3 years.
  • During the entire tenure, an investor may apply three times for partial NPS premature withdrawal. All partial withdrawals can be made free of cost.

5. Senior Citizen Savings Scheme

The Senior Citizen Savings Scheme (SCSS) is a government-backed savings instrument designed to provide senior citizens with a reliable and secure source of income after retirement. Launched in 2004 by the Government of India, it is one of the most attractive savings schemes in India, offering a substantial rate of return and minimal risk of capital loss. Finance Minister Nirmala Sitharaman has announced in the Union Budget 2023 that from 1 April 2023, the senior citizens saving scheme will be extended for a deposit account of ₹30 lakhs from ₹15 lakhs.

  • The scheme is offered by the Government of India
  • This account can be opened at any post office or banks
  • Individuals aged 60 or over on the day they open an account are eligible to open a retirement savings account. Additionally, those aged 55 or over who have retired under Superannuation, Voluntary Retirement Scheme (VRS), or Special VRS can also open an account. This is a great way to make sure that individuals have a secure financial future after they have retired.
  • Retired Defence Services personnel, except Civilian Defence Employees, are eligible to open an account when they reach the age of fifty, provided they fulfill the other specified conditions. This is a great way for members of the Defence Services to access additional funds and financial security in their later years.
  • The SCSS scheme has a maturity period of 5 years, but individuals can extend this by submitting an application in the 4th year of the scheme. This will provide an additional 3 years on the maturity period, ensuring that investors can benefit from the scheme for a longer duration. Those wishing to extend the maturity period should submit their application as soon as possible to ensure that the extension is granted in time.
  • A depositor may open an account individually or jointly with their spouse.
  • The minimum deposit for this account is Rs.1,000, with a maximum of Rs.30 lakh. To ensure convenience, deposits can be made in multiples of Rs.1,000.
  • The interest rate applicable for the SCSS scheme is 8% each year, which is paid on a quarterly basis

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6. Sovereign Gold Bonds

Sovereign Gold Bonds are a form of gold investment issued by the Reserve Bank of India on behalf of the Government of India. They are designed to be an attractive alternative to physical gold investment, as they provide an assured return and open up an additional asset for investors. The Bonds are denominated in multiples of 1 gram of gold and have a tenor of 8 years with exit options in the 5th, 6th and 7th year. If you are seeking an efficient and convenient way to invest in gold, Sovereign Gold Bonds are a perfect option as there are no making charges and you will receive the full value upon selling.

  • The scheme is offered by the Government of India 
  • Investment is open to everyone above 18 years
  • The minimum investment of this scheme is 1 gram of gold
  • The tenor of the bond will be for a period of 8 years with an exit option from 5th year onwards to be exercised on the interest payment dates.
  • These securities are made available via banks, brokers, post offices and online platforms. A discount of INR 50 per gram is offered to investors who purchase them digitally to promote buying SGBs online.
  • Applicants can expect the same return as gold
  • This scheme offers 2.5% annual interest in addition to gold returns
  • There is no GST or any other kind of charges, including capital gains tax

7. Auto-sweep Account

Fixed Deposit, also known as FD, is one of the commonly availed investment options in India. It offers higher interest rates than a savings account. FD can have a tenure ranging from 7 days to 10 years. It is often used to save for various short, medium and long-term financial goals. Auto sweep is a feature that connects your savings account to a fixed deposit account, allowing you to earn higher returns on the excess or idle money in your savings account. The auto sweep feature, as the name implies, “sweeps” excess funds from savings into a fixed deposit account. You must connect these two accounts and establish a monetary limit.  

When the balance in your savings account exceeds this limit, the auto sweep feature kicks in. The amount over the limit is immediately transferred to the fixed deposit account. With this feature, the average interest rate on your idle money grows faster than the interest rate on your savings account. So while a normal savings bank account gives a 3.5% return, all the money above the threshold limit in an auto-sweep bank account earns an 8-9% return.

8. Buying a Property in the name of a Woman

Buying a property in a woman’s name can offer numerous advantages, such as tax benefits (According to the Income Tax Act, women are eligible for certain tax exemptions when they own property), a reduced stamp duty of up to 2% and easier resolution of succession issues. Furthermore, it can help the woman to get a loan from banks, NBFCs and other financial institutions at favourable terms and schemes, with lower interest rates and higher loan amounts. Thus, owning a property in a woman’s name can prove to be beneficial in the long run.

9. Mutual Funds

If you want to invest in the share market, invest in mutual funds, as it is a great way to invest your money. Mutual funds provide diversification, as investors can spread their money across a mix of investments such as stocks and bonds. They are managed by professionals, so investors don’t have to worry about researching individual stocks and bonds. Mutual funds are also cost-effective and offer the potential for growth. They also offer liquidity, making it easy to access funds when needed. Furthermore, mutual funds can help investors reach their financial goals while managing risk. Various Mutual Funds offer varying degrees of risks and returns, and some are more market reliant than others.

There are more than 2500 different mutual fund schemes available. However, given below are the golden rules that can help you choose the right one from it. 

  1. A mutual fund is suitable only for long-term goals. So, Invest in it only if you can hold it for more than 7 years. 
  2. Invest in Largecap Equity Mutual Funds. i.e. Select an equity mutual fund which invests in large companies. 
  3. Invest in mutual funds which have a track record of a minimum of 10 years. 

If your mutual fund scheme is associated with a bank, they provide more stability to your fund. Some good equity mutual funds you can opt for are SBI Bluechip Fund – Growth, ICICI Prudential Bluechip Fund – Growth, Kotak Bluechip Fund – Reg – Growth, and HDFC Top 100 Fund – Growth.

Investing in a Secure Future for Your Family

Term Life Insurance

Term Life Insurance is essential as it helps prevent your savings and investments from drowning due to an emergency. Generally, the life insurance policy that we buy (for instance, LIC policies) provides life cover of only 10 times the annual premium. So, if you are paying an annual premium of Rs. 5000, the life cover will be only Rs. 50,000. This is not a sufficient life cover. On the other hand, Term Life Insurance provides life cover of 500 times the annual premium. So, if you pay a premium of Rs. 5000 in a year, you can get life cover of Rs. 25 lakhs. There are only 2 types of Term Life Insurance Schemes offered by the Government of India. They are:

1. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a government-backed life insurance scheme in India. It provides an annual life insurance cover of Rs 2 lakh to individuals between 18 and 50 years of age who have a savings bank account and are willing to pay a nominal premium of Rs 500 per year. The scheme is available through public sector banks, private sector banks, cooperative banks and regional rural banks. The scheme is renewable from year to year and provides a comprehensive life cover on a family floater basis.

2. Ayushman Bharat: Pradhan Mantri Jan Arogya Yojana (PM-Jay)

Ayushman Bharat, also known as Pradhan Mantri Jan Arogya Yojana (PM-JAY), is a health insurance scheme initiated by the Government of India in 2018. It is the world’s largest government-funded health insurance programme and aims to provide health coverage of up to Rs 5 lakh per family annually. The scheme covers up to 3 days of pre-hospitalisation and 15 days of post-hospitalisation expenses and also covers a range of treatments, including surgery, diagnostics and medicines. There are no restrictions on family size, age or gender. All pre-existing conditions are covered from day 1. In addition, you can avail cashless benefits at any public/private empanelled hospital across the country.


Investments are an important part of financial planning and can be beneficial for many reasons. They can help you build a financial safety net, reach financial goals, and provide financial stability. They also help diversify your portfolios, reduce risk, and increase potential returns. Investing can also help you to build a retirement fund, ensure future financial security, and increase an individual net worth. Investing in stocks, bonds, mutual funds, and other financial instruments can also allow you to participate in the economy’s growth and benefit from the potential of capital appreciation. Investments can also help you to save for your kid’s studies, build a home, or make other large purchases. Therefore, Investing can be a great way to build wealth, generate income, and pursue financial goals.


  1. How to invest in Mutual Fund?

Visit your bank and ask about investing in mutual funds. You will need to do a one-time KYC and then you can start investing. If you already have mutual fund KYC you can also invest using online apps. 

  1. How to link my goal to the financial products we discussed?
  • Home improvement, vehicle purchase: Fixed Deposit, Recurring Deposit, Mahila Samman
  • Children Education: Mutual Funds, Public Provident Fund, Sukanya Samriddhi Yojana
  • Children Marriage: Mutual Funds, Sovereign Gold Bonds, Public Provident Fund, Sukanya Samriddhi Yojana.
  • Old Age Savings: Senior Citizen Savings Scheme, Mutual Funds, National Pension Scheme
  1. Who can avail Pradhan Mantri Jeevan Jyoti Bima Yojana?

Bank account holders between the age of 18-50 can avail this scheme. 

  1. Is Ayushman Bharat: Pradhan Mantri Jan Arogya Yojana (PM-Jay) scheme available only in Government hospitals?

No, you can visit any empanelled public or private hospitals in India to avail cashless treatment. 

  1. What are the advantages of buying a property in a woman’s name?
  • Tax benefits 
  • Reduced stamp duty of up to 2% 
  • Easier resolution of succession issues. 
  • Favourable terms and schemes, with lower interest rates and higher loan amounts.

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