Has the thought of a one-time investment plan ever crossed your mind? Picture this: a single financial move that can lead you towards robust returns.
No recurrent deposits, no daily monitoring – just one strategic decision that could potentially reap considerable rewards. Sounds tempting, doesn’t it?
Investing wisely is crucial for generating returns and securing our financial future, and one-time investment plans can offer you a unique blend of simplicity and potentially high returns.
This 2023, let’s embark on an exciting journey to explore such investment opportunities. Together, we’ll navigate the complexities, demystify the process, and unlock the secrets of making your money work smarter for you.
Ready for the ride? Let’s dive right in!
What is a One-Time Investment Plan?
A one-time investment plan involves making a lump sum investment in a specific financial instrument for a fixed duration. This option is suitable for investors with surplus funds and a high-risk tolerance.
By committing a substantial amount upfront, investors seek potential growth and return over the predetermined period.
The choice of instrument depends on individual financial goals and risk appetite, with higher-risk options offering the possibility of greater rewards.
Top 8 One-Time Investment Plans in India
Finding the right investment plan depends on various factors, including time horizon, risk tolerance, and personal comfort levels.
Unit-linked Insurance Plans (ULIPs) offer a unique advantage by allowing investors to allocate their funds across different avenues, striking a balance between returns and security.
While equity investments present higher risks but potentially better long-term returns, debt investments offer safer yet fixed returns.
Taking all these factors into account, we present the best one-time investment plan to make the most of your bonus income.
1. Public Provident Fund (PPF)
The Public Provident Fund (PPF) is a government-backed investment scheme with a 15-year lock-in period. With compounded returns, it offers attractive maturity benefits. Investors can contribute a maximum of ₹1,50,000 annually, with a minimum of ₹500.
Flexible investment options allow bulk sum or monthly contributions. After five years, partial withdrawals are permitted.
PPF also offers income tax deductions under Section 80C, with a maximum cap of ₹1,50,000 per financial year, making it a popular choice for long-term tax-saving investments.
2. Invest in Gold ETFs
Gold exchange-traded funds (ETFs) offer a convenient and efficient way to invest in gold without the need to possess the precious metal physically.
Functioning as passive investments, these ETFs closely track domestic gold prices and are available in digital form. Each unit represents one gramme of 99.5% pure gold and can be easily traded on stock markets.
Gold ETFs reduce risks and expenses associated with owning real gold by eliminating the need for physical storage.
Moreover, they enjoy favourable tax treatment, making them an attractive option for investors seeking to profit from gold investments while optimising tax obligations.
3. Mutual Funds for Lump Sum Investment
Mutual funds offer a strategic approach to investing by pooling capital from multiple investors. Equity mutual funds, with at least 65% invested in stocks, carry higher risk but offer the potential for substantial long-term returns.
These funds cater to various risk profiles and investment durations, including lump sum and Systematic Investment Plan (SIP) options.
For those seeking to achieve financial goals through long-term investing, equity mutual funds can provide a reliable means to navigate market volatility and generate better returns compared to traditional fixed deposits and savings accounts.
For investors juggling between options, understanding Choosing Between Mutual Funds and Smallcase: A Guide to Smart Investments can offer much-needed clarity.
4. Fixed Deposits (FD)
In India, bank fixed deposits (FDs) reign as the most favoured low-risk one-time investment plan with assured high returns. FD is the best investment plan for 1 year to 5 years.
Despite offering lower interest rates compared to other options, the guarantee of returns makes FDs highly attractive for long-term investments.
The flexibility to receive interest payouts at varying intervals – monthly, yearly, weekly, or daily – further enhances their appeal to a wide range of investors.
5. Post Office Fixed Deposit
Post Office Fixed Deposit is a popular savings program, with interest rates determined by the Ministry of Finance quarterly. With a minimum investment of INR 1,000, this one-time investment plan offers tenures ranging from one to five years.
Depositors have the option to reinvest their interest, except for one-year deposits, and can redirect the interest to a five-year recurring deposit program.
Moreover, if not withdrawn at maturity, the cash is reinvested at new interest rates.
Additionally, these fixed deposits qualify for tax deduction under Section 80C of the Income Tax Act, allowing investors to claim tax benefits of up to INR 1.5 lakhs annually when filing their income tax returns.
ULIP (Unit-Linked Insurance Plan) is a one-time insurance scheme that combines life coverage with investment opportunities, catering to individual risk preferences.
With a five-year lock-in period, it allows investors to switch between funds, optimizing returns.
Additionally, contributions to ULIPs qualify for tax deductions under Section 80C. This unique plan empowers policyholders to secure their future financially while exploring potential growth avenues.
7. National Pension Scheme
The National Pension Scheme (NPS) is a government initiative open to employees in public, private, and unorganized sectors, expanding from its initial exclusivity to public sector personnel.
Individuals can opt for NPS investments during their working years, with the flexibility to withdraw a portion of the accumulated funds post-retirement while the rest is invested in an annuity. This ensures a regular monthly pension for the retiree.
Additionally, NPS investments offer attractive tax benefits, allowing deductions of up to INR 1.5 lakh under section 80C and Rs 50,000 under section 80CCD.
There are two types of National Pension Schemes: NPS Tier 1 account and NPS Tier 2 account.
- NPS Tier 1 account: The Tier 1 account in the National Pension System (NPS) is a fundamental type with a Permanent Retirement Account Number (PRAN). It remains active until age 60, allowing investment to be locked in until retirement. At maturity, 60% of the amount can be withdrawn tax-free, while the remaining 40% must be used to purchase an annuity, with its income taxable according to the individual’s income tax slab rate.
- NPS Tier 2 account: NPS Tier 2 account is optional, available to Tier 1 account holders. It requires a minimum initial deposit of INR 1,000 and allows withdrawals without any lock-in period. Minimum additional contributions are INR 250.
8. Green Assets
Green assets have emerged as a promising one-time investment opportunity in India. A shining example is SustVest, a platform specialising in eco-friendly investments.
SustVest offers options like investing in sustainable forestry, renewable energy, and organic farming projects. Investors can enjoy the high returns of 10-11% p.a., provided monthly, which significantly outperforms traditional forms of investments.
This one-time investment in green assets not only ensures robust financial returns but also contributes to the betterment of the environment.
By choosing Green Assets, investors can transform their financial future and make a lasting impact on the planet. These factors make green assets a popular choice in India’s list of one-time investments.
Advantages of One-Time Investment Plans
One-time investment plans high returns offer numerous advantages. Let’s explore five key benefits of these plans:
- Potential for High Returns: One-time investment plans, particularly those involving equity-based options like Equity Mutual Funds, have the potential to deliver impressive returns over the long term. As equity markets tend to outperform other asset classes, investors stand a chance to capitalise on market growth and generate substantial profits.
- Compounding Growth: With a lump sum investment, the power of compounding comes into play more effectively. As the invested amount grows over time, the returns start earning additional returns, accelerating the overall growth of the investment. This can significantly boost the final corpus, especially in high-return instruments like equity funds.
- Immediate Investment Benefits: By investing a lump sum amount, investors can immediately start benefiting from potential market gains. Unlike periodic investments, where funds are gradually deployed over time, a one-time investment allows capitalising on favourable market conditions from the start.
- Time-Saving and Convenience: Opting for a one-time investment plan eliminates the need for frequent investment decisions and transactions. Investors save time and effort by making a single allocation, reducing the hassle of monitoring and managing multiple investment installments.
Investors seeking growth might consider a one-time investment plan with high returns. To make lucrative judgements, investors must carefully examine their risk tolerance, financial goals, and investment horizon while considering these advantages.
Making the right investment decision is a strategic process. To make informed choices, it may be useful to follow The 6-Step Investment Decision Process: A Blueprint for Smart Investing.
What is a one-time investment plan?
A one-time investment plan refers to a financial scheme where you invest a lump sum amount in a single transaction rather than making regular contributions. It offers an opportunity to grow your money based on the plan’s performance and your chosen investment vehicle.
Which one-time investment plan is best for risk-averse individuals?
For risk-averse investors, low-risk options like Fixed Deposits (FDs), Public Provident Funds (PPF), and Debt Funds are ideal. These plans provide stability and relatively predictable returns over the investment period.
Can I withdraw my investment from a one-time plan before maturity?
Yes, many one-time investment plans allow premature withdrawals, but it may come with certain penalties or reduced returns. Equity Mutual Funds, for instance, usually have no lock-in period, while PPF and NPS have specific conditions for early withdrawals.
Are one time investment plans tax-efficient?
Tax implications vary depending on the type of investment plan. Equity Mutual Funds held for more than one year enjoy long-term capital gains tax benefits, while FDs and Debt Funds are subject to tax based on your income slab.
The best one-time investment plan for 2023 depends on individual risk tolerance and investment objectives. For low-risk seekers, PPF, NPS, FDs, and Debt Funds offer stability and steady growth.
Meanwhile, those willing to embrace higher risks may find potential in Equity Mutual Funds. To ensure the right fit, it’s essential to evaluate your financial goals and preferences carefully.
While these options are valuable, don’t forget about other promising opportunities. For instance, understanding Tax Incentives for Renewable Energy in India: A Guide for Businesses could reveal exciting prospects
For sustainable investment options, explore SustVest, a platform dedicated to eco-friendly and socially responsible investments. Make informed choices and secure a prosperous financial future with SustVest.
Founder of Sustvest
Hardik completed his B.Tech from BITS Pilani. Keeping the current global scenario, the growth of renewable energy in mind, and people looking for investment opportunities in mind he founded SustVest ( formerly, Solar Grid X ) in 2018. This venture led him to achieve the ‘Emerging Fintech Talent of the Year in MENA region ‘ in October 2019.