Retirement age in India is somewhere between 58 and 65. While this is the ideal age, people today are looking to retire early before 50 so they can chill and enjoy their life. The only way one can do so is with a huge retirement fund.
Do you want to know how you can create the best retirement investment plan? Well, you’ve come to the right place as I will give you the 3 best invest options in India.
With these, you can invest for long term and accumulate wealth within 10-15 years.
Now, I know how difficult it is to save money in today’s time. But it’s equally important to invest today if you want a better tomorrow. You can
- Invest in Gold
- Invest in real estate
- Invest in mutual funds
- Invest in stock market
- Invest in NPS
- Invest in equity
- Invest in PPF, etc.
While there are so many options to choose from, I will make it simple for you with 3 options that I feel will work wonders to accumulate your wealth.
1. Invest in PPF:
Public Provident Fund is one of the oldest options in this list. People turn to this to invest for the long term up to 15 years. With an interest rate that has always been above 7% and the power of compounding, you can accumulate a lot of wealth.
Situation 1 – If you invest 75,000 per year for 15 years @ 7.1% interest,
Your Total investment amount – 11,25,000
Total Interest amount – 9,09,105
PPF amount after 15 years – 20,34,105
Situation 2 – Also, if you invest 1,50,000 per year for 15 years @ 7.1% interest,
Total investment amount – 22,50,000
Total Interest amount – 18,18,209
Your PPF amount after 15 years – 40,68,209
Hence you can save anywhere between 20 and 40 lakhs for your retirement within 15 years. So start planning! P.S – I have considered only 7.1% as the overall interest rate but PPF rates are revised every now and then. So you can expect a hike in the rates too.
Click here to check calculation – Retirement planning calculator using PPF
2. Invest in NPS:
NPS also called the National Pension System is an initiative by the Pension Fund Regulatory and Development Authority (PFRDA).
Also known as the longest form of investment, you can invest in this until your retirement age of 60. However, the current rate of interest ranges between 9 to 12%*.
Situation 1 – If your current age is 30 and the retirement age is 60, this means you can invest in NPS for 30 years. If you invest 75,000 per year for 30 years @ 9% interest,
Your Total investment amount – 22.5 lakhs
Total Interest amount – 88.93 lakhs
Total retirement amount – 1 crore 11 lakhs
Situation 2 – Also, if your current age is 30 and the retirement age is 60, this means you can invest in NPS for 30 years. If you invest 1,50,000 per year for 30 years @ 9% interest,
Your Total invested amount – 45 lakhs
Overall Interest amount – 1 crore 78 lakhs
Finally, Total retirement amount – 2 crores 23 lakhs
However, There is another way you can use NPS. If you wish to get 1 crore rupees in your account at your retirement age of 60, you can calculate that too.
Investment goal at 60 years – 1 crore
Your current age – 30
How much will I need to invest every year – 67,306
You can also read – Safe investments with High returns in India
3. Invest in Mutual Funds:
Also, an option that needs no introduction, Mutual funds have proven to be one of the best investments. Using SIP, you can invest directly in mutual funds and witness the power of compounding.
Situation 1 – If you invest 75,000 per year for 15 years @ 9% interest,
Your Total investment amount – 11,25,000
Overall Interest amount – 12,57,774
Finally, Total PPF amount after 15 years – 23,82,774
Situation 2 – However, If you invest 1,50,000 per year for 15 years @ 9% interest,
Your Total investment amount – 22,50,000
Total Interest amount – 25,15,548
Finally, Total PPF amount after 15 years – 47,65,548
Consolation options – Also, There are other investment options like Real Estate, Gold, and Stock Market. You can opt for these too.
In conclusion, If you can understand how much retirement money you need, planning for retirement will become easier. I hope this post helps you invest for long term and plan for a better future.
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