As you are reading this, the price of tomatoes has crossed 200 Rs a Kg, Making it even more costlier than petrol and diesel. Not just tomatoes, but several food items continues to rise due to weather and inflation, affecting your everyday expenses.
When the prices of basic necessities soar higher, it becomes challenging to invest a larger portion of your savings. However, to overcome this temporary setback, you can unleash the powerful weapon of compounding to turn your small investments into substantial ones.
How to do that, though? Simply by vetting the small investments that make money. In this blog, we will unveil eight small investments that make money in 2023.
Let’s dive into these investment options to help you prepare your ultimate investment corpus. Among these investment options, some require a minimum monthly savings of barely Rs. 100, while others provide a means to overcome inflation and build a more secure financial future for yourself.
Small Investments that Make Money
2.Exchange Traded Funds
5.Guaranteed annuity plans
6.Dividend yield stocks
7.Saving Schemes – PPF, NPS, And FDs, Kisan Vikas Patra, NSC
Mutual Fund – Starts From ₹500 a Month
Mutual funds, one of the best investment options in India, offer systematic and small investments that make money. With savings as low as Rs 500 per month, you can invest as per your risk appetite and reasonable financial goals.
With mutual funds, seasoned portfolio managers manage and rebalance your portfolios, leveraging their knowledge of financial markets and fluctuations. They use their expertise to invest in various stocks based on their ability to evaluate and select stocks for investment based on various factors, including risk, capital, and industry analysis. Based on their performance in the stock market, investors earn returns.
Mutual funds exhibit a safe yet high rate of return, with some funds consistently delivering over 15-20% returns even over five years. Unlike other saving schemes, most funds have a maximum lock-in period of 3 years while maintaining high liquidity with settlement periods of T+3 days or T+1 days.
Exchange Traded Funds – Starts From ₹50
ETFs are a combination of mutual funds and shares; they track the performance of securities, shares, gold, and bonds. They offer lower expense ratios than mutual funds and can be bought in units. Touted as an upcoming high-return investment in India, three types of popular ETFs are traded in the stock market. These ETFs are listed as follows
- Gold ETFs -Tracks the market rates of physical gold.
- Thematic ETFs – Mirrors the price fluctuations of specific sectors like banking and healthcare; and so on.
- Index ETFs reflect the performance of indices like Sensex and Nifty.
While there is no minimum investment amount, investors need to buy atleast one unit or share of ETF. For instance, Gold ETFs start at ₹50 whereas Index ETFs start at ₹200, and so on.
Smallcase – Investment Starts From ₹313
Smallcase is an investment platform in India that empowers you with unique features,making it one of the best investment choices available. In Smallcase, there is no lock-in period, curated portfolios managed by experts, and the ability to own shares of individual stocks in your demat account.
The reason smallcase stands apart from other investments is threefold. Firstly, it offers curated theme-based portfolios aligned with their interests, like renewable energy, rural development, infrastructure, etc.
Secondly, it grants investors ownership of the shares in their demat account, with notifications for every rebalancing, keeping investors in the loop. Lastly, it allows investors to create their own personalized portfolios.
Suffice it to say, as one of the best investments in India, you can start your journey with a smallcase by investing a minimum of ₹313 in their equity and gold portfolio. It’s an excellent opportunity to explore the world of curated theme-based portfolios and make your investment journey seamless and rewarding.
Invest in Solar Energy from ₹5,000 | Proportional Ownership, 10-15% Returns, Beat Inflation
This high-return investment alternative in India has jaw-dropping returns+ rental yield. It is hard to believe such small investments can make more money than traditional investment alternatives. As India gears up for carbon neutrality, solar energy is poised to become a money-minting avenue for investors.
Over the past decade, both solar energy consumption and investments have soared. International solar capacity has quadrupled from 414 GW to approximately 1,650 GW, with India now ranking 4th globally.
For instance, take SustVest. This investment platform allows one to reap double the benefits. Earning 10-15% returns while gaining digital ownership and monthly proportional rental yield.
What’s truly fascinating is that investing in Sustvest outperforms traditional avenues like fixed deposits and mutual funds, enabling you to beat inflation. However, if you’re interested in investing, keep an eye on Sustvest’s live projects on the website, as they fill up rapidly.
Before these projects get filled up and you miss the chance to earn up to 15% returns with passive income, seize this lucrative opportunity and become a part of the renewable energy revolution.
Saving Schemes – PPF, NPS, And FDs, NSC – Starts from 100
Saving schemes have long been the saving grace for the older generation, providing a secure avenue for retirement planning. These schemes offer guaranteed returns while maintaining a low-risk profile. They are small investments that make money.
Lets explore the three notable options that stand out in India: PPF (Public Provident Fund), NPS (National Pension Scheme), NSC (National Savings Certificate), and FD (Fixed Deposit). By comparing its salient features, you can select the assured return offer that best suits your needs.
The table below provides a comprehensive comparison of these three options, highlighting their minimum investment, rate of return, and lock-in period. By examining these features, you will be able to make a clear and informed choice about where to invest your money.
Small Investments That Make Money In 2023 : Comparison Between Saving Scheme
|NPS||PPF||National Saving Certificate (NSC)||FD|
|Rate of Interest||Floating rate( 8 to 10)||7.1%||6.8%||Upto 6.5%|
|Lock in Period||Tier-1 – Till Age 60||15 years||5 years||2,5,10 years|
Annuity Plans – Guaranteed Retirement Income Starts From ₹500
Let’s say you invest ₹500 per month for ten years in this investment, totalling ₹3,00,000 by 2033. After this period, a guaranteed annuity plan kicks in, offering a monthly payout of ₹5,000 for the next ten years until 2043. It seems like a convenient retirement plan, doesn’t it?
This demonstrates how these plans work: you make small investments over a defined period, and upon retiring, you receive a fixed monthly income. Moreover, it’s important to note that these plans can be customized, allowing you to adjust the investment tenure and retirement payout duration.
By comparing different plans and customizing them to your needs, you can secure a fixed monthly income and financial stability in your retirement years. This approach ensures that your retirement planning aligns precisely with your specific financial goals and preferences.
By comparing different plans and customizing them to your needs, you can secure a consistent income stream and financial stability in your retirement years. This approach ensures that your retirement planning aligns precisely with your specific financial goals and preferences.
Dividend Yield Stocks – Value Appriciation+ Income
In the series of “small investments that make money options,” dividend yield stocks are underrated gems. For one, they offer consistent returns periodically. As generally dividend yield stocks offer dividend either quarterly, half yearly or yearly.
Additionally, over time, there is a significant increase in value. This inflation-proof instrument is also less risky than other options and less likely to be affected by market crashes.
Dividend-paying companies are fundamentally more robust and more likely to survive market fluctuations. They have a history of generating positive returns consistently and maintain minimal to low debt level. Moreover, the fact that they distribute dividends indicates their ability to generate excess cash flow as well.
Therefore, evaluating shares based on the dividend option can assist you in earning passive income. Additionally, there is always the option to reinvest the returns, allowing your investment to grow further.
Frequently Asked Question
What Are the three Best Small Investments that Make Money?
You can choose the best three options that sit well with your risk appetite and financial goal from of some of the best investments in India i.e., mutual funds, ETF, shares, smallcase, renewable energy investments in fractional property, annuities, and saving schemes.
Why Should I Choose Inflation-Beating Investment?
Choosing an investment that beats inflation is important because it helps preserve the value of your money, protects against rising costs, supports long-term financial goals, and enables you to build wealth over time.
What Should I Consider Before Comparing Small Investment High Returns Options?
Before comparing small investment options with high returns, it’s important to consider risk tolerance, investment horizon, market conditions, and diversification.
Diversifying your investments across various options can indeed become confusing when considering the pros and cons of each instrument. Instead, opt for a carefully selected limited range of investment options that have the potential to multiply your money both in the short term and long term.
For effective retirement planning, creating a well-balanced portfolio with a mix of instruments, such as PPF, NPS, annuity, and mutual funds, can be the answer. These small investments have the potential to yield more significant returns and help secure a financially stable retirement.
Similarly, investing in renewable energy and dividend-yield options can generate passive income. ETFs and Smallcase can be your go-to options for short-term goals. To ensure adequate diversification, consider your specific objectives, risk tolerance, and investment horizon.
Seeking advice from a SustVest expert can also help you make a more constructive decision aligned with your financial goals.
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.