Where is your Money Safe - Gold, Silver or Bank?
Most of us are not economic analysts or have a good grasp of the market, so knowing how to save money to secure our future becomes an important question.
In this era of uncertainty when Corona of the world momentarily due to infection. Things are changing, it is natural for the common man to ask where he should invest his money. Most of us are not economic analysts or have a good grasp of the market, so knowing how to save money to secure our future becomes an important question. Let us know from some economic analysts where money will be more secure ?
Gold
Due to some influential factors like high liquidity and inflation potential, gold is one of the most preferred investments in India. In traditional forms, you would buy gold in the form of jewelry, coins, or artifacts. Nowadays the scenario has changed you can buy Gold ETFs, Gold Funds, Sovereign Gold Bonds.
What are Sovereign Gold Bonds?
Sovereign Gold Bonds are the safest way to buy digital gold, as they are issued by the Reserve Bank of India on behalf of the Government of India with an assured interest of 2.50% per annum. Bonds are denominated in units of gold with a base unit of 1 gram. A maximum investment can be of 4 kg. These bonds have a tenure of eight years with an exit option of the eighth year.
Top Gold Funds
• Axis Gold Fund
• Aditya Birla Sun Life Gold Fund
• Canara Robeco Gold Saving Fund
• HDFC gold fund
• ICICI PU Regular Gold Savings Fund
Why invest in gold ?
For a traditional investor, the most important criteria are safety, liquidity and profitable returns. You can expect to meet all these criteria while investing in gold. If you are not in favor of keeping physical gold, you can go for other options.
What documents do you need ?
If you invest in more than 2 lakh gold then you need a PAN card. In ETFs, you need to open an account with a brokerage firm followed by a demat account with the same firm. For investment in Sovereign Gold Bonds, documents required for KYC, are required to purchase physical gold (Aadhaar, PAN, Voter ID or Passport).
Silver
Silver is an inexpensive and reliable precious metal. We have been using silver instead of gold for auspicious works for many years.
Small investment
If you are planning to invest a few thousand rupees in silver, you can consider buying coins. Coins usually have drawings and labor fees added to the final value. It is a good option for salaried individuals and business people. You can deposit some coins every month as per your capacity and it is also possible to sell them when you want to liquidate your investment.
Another advantage of buying silver coins is their availability in banks. You also get a certificate of correctness. Banks will only sell silver coins and will not buy them back later. In future you need to approach jewelers to sell your silver coins.
Choose Silver Bars for Huge Investment
You can invest in bulk on such silver bars. There is a good demand for silver bars in the market, you will not have any problem when you want to sell them later. Make sure you have enough money for additional needs. Silver coins and bars should always be bought from reliable sources. Certified coins should be purchased from banks. Even if they charge some extra premium. Talking about silver bars, you should contact local jewelers. One should always opt for bank lockers to keep silver safe. Silver rates fluctuate on a daily basis. There are many apps and other sources that will provide complete information about the latest silver price in the market and you can use them on your mobile phone to get accurate details.
Bank
Most investors want to invest in such a way that they get high returns as quickly as possible without the risk of losing the principal amount. In fact, risk and return are directly related. The higher the return, the higher the risk. Your money is always safe in banks and interest is earned with slight fluctuations.
Bank Fixed Deposit (FD)
Bank fixed deposits are considered safe. Every depositor in a bank is insured for both principal and interest amount with effect from February 4, 2020 up to a maximum of Rs 5 lakh. As per the requirement, one can choose monthly, quarterly, half yearly, yearly or cumulative interest option. The interest rate earned is added to the income and taxed as per the income slab.
Public Provident Fund (PPF)
Any Indian citizen can open a Public Provident Fund in a bank or post office for a period of 15 years. Its interest is tax free from income tax and is paid at compound rates. The minimum amount is to be deposited one thousand per year and the maximum can be made one and a half lakhs. Loan can be taken on this after four years. The interest rate is reviewed by the government every quarter. After 15 years you can increase it by 5-5 years.
National Pension System (NPS)
It is a government sponsored pension scheme. It was launched in January 2004 for government employees. In 2009 it was opened to all classes. The scheme allows regular contribution to the pension account during the working life. After retirement, you can withdraw a part of the money and use the remaining money, so that you can get a fixed amount every month.
Senior Citizens Savings Scheme
Only senior citizens or early retirees can invest in this scheme. SCSS can be availed from any post office or bank above 60. SCSS has a tenure of five years, which can be extended for another three years after the maturity of the scheme. The upper investment limit is Rs 15 lakh and more than one account can be opened. The interest rate on SCSS is payable quarterly and is fully taxable. The interest rate of the scheme is subject to review and revision every quarter. Once invested in the scheme, the interest rate will remain the same till the maturity of the scheme. Senior citizens can claim deduction up to Rs 50,000 in a financial year under section 80TTB on interest earned from SCSS. Yogesh Chandak Senior Chartered Accountant says that 'one should invest in a diversified portfolio. Gold is good for long term planning, but it does not have that much advantage. Silver being cheap is accessible to everyone. Investing in various schemes of the bank keeps your money safe but the returns are not high. The rule of investment is 'higher the risk higher the written'. Economic Analyst Mr. Anant La is not advising his clients to invest in gold as according to him the price will not rise now. The 'peak' of gold has come, silver can rise against it. Debt fund FD, PPF in banks. Investment in is safe. Investments are made based on one's ability, need, age and market knowledge. Long term investment and short term investment depend on the amount of liquidity you have. There is an old saying 'Don't put all the eggs in one basket' but it fits perfectly for investing. Invest your funds keeping in mind your future needs, risk factors and trends.