Safest Investments With High Return On Investment
Whenever choosing any investment options, following 3 things are important to be considered in order for your money to provide you highest return on investment:
- Present financial status
- Associated risks
- Rate of Interest
While every investment gives you good ROI, there are some safest investments with highest return and lesser risk which secure your financial future. These are as follows: (Remember, risk free investment options generally yields less returns):
Savings Bank Account:
This is considered to be the safest investment option with best yield and most importantly it is a risk free option.
Where can you open a/c:
Almost every bank offers this viz.
- Public sector
- Private sector
- Minimum to zero balance required.
- Balance in your account is directly proportional to the return. So good amount of balance will yield you higher return (For e.g. Rs.10, 000 kept in savings bank a/c with State Bank of India yields Rs.200 with 4% interest. For next half year, it will fetch interest on Rs.10, 200 , and you’ll get Rs.204 as interest and so, on)
- Money can be withdrawn at any given point of time.
Best Recommended For:
- Salaried individuals
- Persons with limited source of income.
- No risks. Since your money is safe with bank.
Certificate of Deposit (CD):
This is also one of the safest investment option with higher return on investment but is best suitable for short to medium term investors. It is different from savings bank a/c, where you have to invest a large amount for specific period, starting from few months to few years and for specific rate of interest.
Where can you get CD?
- Public and Private Banks
- Loan Institutions
Advantages of CD:
- Offers high amount of returns for large sum of money kept.
Best Recommended For:
- Short term investors
Risks of CD:
- In case of premature withdrawals you lose on interest.
- Few service providers may penalize you when money is withdrawn prematurely. (Tip: Always read terms and conditions of your investing company)
- Money is under arrest for certain amount of period.
- Yields poorly when length of period for which money is kept is increased.
- Investments are taxed.