If you have Rs 1 lakh to invest, NSC, FD, or Mutual Funds offer different risk-return profiles. Choose based on safety, liquidity, and long-term goals.
FD: Fixed deposits have long been trusted by Indian investors and are available via banks and post offices. Currently, a 5-year post office FD offers around 7.5% interest, while banks offer between 6-6.5%. FDs are low-risk, but the interest earned is fully taxable, which may reduce net returns. For example, Rs 1 lakh in a post office FD for five years can grow to around Rs 1.45 lakh, although real gains may be slightly lower after accounting for inflation.Mutual Fund Lump-Sum: For investors willing to take some risk, a lump-sum investment in equity mutual funds can be rewarding. Experts say equity funds can yield 10-12% annually over the long term, though returns fluctuate with market conditions. A Rs 1 lakh investment over five years at an average 12% return can grow to around Rs 1.75 lakh. However, there is no guarantee, and market ups and downs are expected.Which Investment Is Right for You? If safety is your priority, then it is recommended to choose NSC. If both safety and liquidity are important, then choose FD and if your goal is high returns and you can withstand market fluctuations, then Equity Mutual Funds.While investing, consider risk, taxes, inflation, age, income, family responsibilities, and future goals, not just potential returns. A carefully planned strategy aligned with your needs ensures long-term gains.Disclaimer: This information is for general awareness and not investment advice. Consult a financial expert before making any investment. News18 is not responsible for investment outcomes.
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If you have Rs 1 lakh to invest and can keep it untouched for at least five years, choosing the right investment option is crucial. Each investor’s goals and risk appetite are different. Some prefer complete safety, while others are willing to take some risk for higher returns. Three popular options in India are National Savings Certificate (NSC), Fixed Deposit (FD), and lump-sum investments in Mutual Funds. Let’s look at how much these can grow over five years.
