30 Dec 2023
The goal of investing money for financial growth is shared by people of all ages worldwide. And when it comes to this, college kids are quite motivated. Investments might provide them more confidence as they prepare to go on their career path and begin earning money. Additionally, it fosters financial literacy, which will enable students to make wise decisions throughout their lives. What are the various investment choices available to Indian students? To better assist them, consider this detail. Let’s first examine the financial investing goals of Indian college students before moving on.
The selection of investment plans is contingent upon personal goals and financial feasibility. These are some potential investment goals.
- Pay back your student loan.
- Encourage parents who put in a lot of work.
- Save money for further education.
- Raising money to launch a new business.
- Establish the discipline of consistent investing.
- Try out various investment plans for students.
Straight Equity
Investing in stocks is one of the best strategies to build wealth for your long-term objectives. Numerous equities exist that have increased investors’ wealth over time. For instance, during the past 15 years, Indian non-banking financial firm Bajaj Finance has produced an annualised return of more than 41%.
Mutual funds:
Investing in financial assets is one approach to build wealth over time. Additionally, Students can always take on more risk on the investing platform when they are younger. Students need to feel comfortable while making financial decisions, for instance, if the investment is dependent on their parent’s income or their part-time business. They should definitely think about making a medium-risk investment. For students, mutual funds are safe investment solutions that assist them in selecting funds according to their financial situation and risk tolerance. It is also advantageous since, unlike with the systematic investment plan option, students can elect to invest in it on a regular basis as opposed to all at once.
Government bonds:
Saving money in government bonds may be the best option if the goal is to support parents, pay off debt, etc. It might yield lower profits. But since the government looks after it, the investment is safe. Both short-term and long-term bonds are available. Students can thus select their tenure and make investments in it based on their financial needs.
Life insurance:
If one has a lot of financial commitments, life insurance is regarded as one of the possibilities for saving. In the event of their untimely death, it can assist their parents in repaying their school loans. Furthermore, a life insurance provider offers the choice to include additional riders, which increase the benefit amount by paying out in the event of certain circumstances.
Real estate:
Among Indians, it is undoubtedly one of the most well-liked investment possibilities. However, even if real estate investing has historically produced astounding profits, there are dangers and drawbacks associated with it. Being inability to swiftly dispose real estate is one of the main hazards involved. Students might also have to sell the property at a steep discount if you’re in a hurry to sell it.
Cryptocurrencies:
Because of their higher returns and variety, cryptocurrencies are gaining popularity. It provides transparency in the approach at various investment phases and is decentralised. It is an excellent option for long-term investment needs and adaptable for independent trading. But making cryptocurrency investments necessitates having sufficient understanding of the available options, the platform, and the investing procedure. As a result, students must become familiar with the process and make appropriate plans and investments.
Deposit plans:
For students, the banks provide a variety of investing plans. The two most popular types of deposits are recurrent and fixed.
Students can set aside money as a fixed deposit for a predetermined amount of time if they receive a lump sum gift from their family. The money will generate timely fixed interests that they might use for other pursuits or their schooling. They can set up a recurring deposit to save money they get from trusts or other institutions on a regular basis. Along with the interest that becomes withdrawable upon maturity, the money will accumulate.
Derivative market:
Derivatives are an excellent option for students who want to experience with various financial market possibilities. Students can broaden their understanding of the various underlying assets, price fluctuations, and other elements influencing supply and demand early in life.
A certificate of deposit or CD
A tiny investment choice that aids students in increasing their money is a certificate of deposit. They can open a high-interest rate certificate of deposit (CD) or a high-yield savings account. These schemes’ best feature is that it lets you take money out whenever you want. With CDs, you pay a certain interest rate to the bank in exchange for keeping your money there for a predetermined amount of time. You receive a respectable sum at the conclusion of the term because the quantity in CDs doesn’t change. Therefore, CDs are a risk-free investing option that is ideal for students.
Student Investment Plan under ULIP
Students looking to invest their money may also think about ULIPs (Unit Linked Insurance Plans) in addition to SIPs. It provides two advantages for one premium. The chance to make capital market investments is offered in the first section of the premium. The remaining portion of the fund provides life insurance coverage concurrently. The learner will also receive three different kinds of funds to use for money market investments. These three types of investments are debt, equity, and hybrid. A student with a strong willingness for risk could invest in stock in the first instrument and make a sizable return. The student can invest their money in the loan instrument to lower the risk and get a respectable return. Ultimately, within the Last word.
In summary in India, buying financial assets is seen as a motivating factor for all college students. But choices on investments need to be well-considered. It must take into account the sources of income and the necessary funds.
Now that you are aware of all the many programs and secure investment opportunities available to you as a student. To get the most out of your investments over time in terms of gained capital, all you have to do is gather knowledge and get started as soon as possible. To discover your finest possibilities in this regard, you may also search for different ways to invest a modest sum of money. Furthermore, to invest in the plan that will provide the most returns, it is always advantageous to get knowledgeable about the several options and plans that are accessible.
- What are the other attractive investment options available for students in the Indian scenario?
- How important is it to inculcate the financial discipline in today’s generation and why?
- What is the role of the education system in educating students on financial literacy?
