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Aman Khanna
by on May 8, 2018
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When you think about an investment, it is usually for the long term. However, what would you choose if you have short-term goals? How would you reach your goals? Even if you have short-term goals, you can’t give up planning. There are many instruments where you can invest for a short-term and achieve your goals. Any investment for a time of up to five years is called as a short-term investment. Short-term investments need better risk management, and the knowledge of assured returns you would get on them. There are a few great Investment options that you can consider ensuring that your short-term financial goals are met.

Fixed deposits

For those that are not significant risk takers, this is the best option for you. Fixed deposits (FD) allow you to choose either short term or long-term investment plans. You can select an FD plan for a term of seven days to ten years, depending on your financial goals. On an average, the interest rates for a fixed deposit are between 6 and 9%. Bajaj Finance offers an interest rate of 7.85% on FDs, which can go up to 8.20% for senior citizens. Calculate your gains using the Fixed Deposit Interest Calculator online.

Recurring deposits

Recurring deposits (RDs) is an excellent option if you want to save money in the short term for over a period of months. This option is also known as term deposits that can have a maturity of between six months to ten years. RDs are like fixed deposits, and opening one is an easy process if you have a net banking option. The interest rates are set when you open the account based on the due date of your account. However, closing this account before time can cause you to pay the penalty. If you’re looking for quick access to money, pre-approved offers by Bajaj Finance can help you save time. You can avail your money in just 3 clicks.

Debt funds

If you want to invest money for less than three months, you can also choose to invest in liquid funds. If you’re short-term goals fall between three and six months, then you can put it into ultra-short-term funds. These investments do not have any tax deductions unless you invest for more than 36 months. Before choosing the best funds for you, it is best if you consult with a fund-advisor who would help you choose one according to your financial goals.

Company deposits

If your goal is to get higher returns than an FD, you can also choose to invest in company fixed deposits. However, you may need to heed caution with company FDs as they come with a risk. Choose only high rated company FD schemes and diversify your funds across various companies rather than putting all your eggs in the same basket.

Gold investment

Even though appreciation of gold-prices is not guaranteed, investment in gold is usually considered safe for both short-term and long-term periods. Gold can be liquidated for cash in emergencies and also offers protection against uncertainties like social unrest, banking crises and inflation. Gold prices fluctuate according to the demand of the yellow metal and are free from stock market trends.

Fixed maturity plans (FMPs)

FMPs are closed-end debt mutual funds having a predetermined maturity period, which usually is for five years. Investment in FMPs is available only during the New Fund Offer (NFO) period and is not available for subscription on a continuous basis. FMPs are pretty similar to FDs, as both require you to stay invested for a predetermined period. However, both are different, as FDs guarantee a certain return, FMPs offer only an indicative return. FMPs are becoming popular amongst investors who like to play safe, for the fact that returns usually are higher than FDs. FMPs usually invest in debt instruments like corporate bonds, bank fixed deposits, certificate of deposits (CDs), commercial papers and money market instruments.
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