Some Good Fixed-Income Investments Options in India

Perhaps your business has generated hefty profits during the festive season, and you don't want this money to sit idly. Or you have earned higher returns in stock investments and have extra cash in your bank account. Or you are simply looking to save your funds to meet a long-term financial goal.

Whatever the reason, you need a safe investment option that offers you guaranteed returns. Fixed-income investments are one such type of alternative investment. Defined by their investment style and anticipated returns, fixed-income plans offer steady returns (and fixed income) without the volatility of market-linked plans.

They are a popular form of investment for investors looking to diversify their portfolio with alternative investments and gain stability and liquidity. So, if you're looking to invest your funds for reliable returns, here are the best fixed-income investment plans to consider-

1. Public Provident Fund

PPF has been a top investment avenue for investors with a low-risk appetite. Backed by a government guarantee, you can easily open a PPF account with a bank and earn assured higher returns over time. While you can invest up to Rs. 1.5 lakhs per annum for a tenure of 15 years; you can even block your investment for 5 more years for higher returns.

The best feature of PPF investments is tax savings. Under section 80C of the ITA, interest earned on PPF investments up to Rs. 1.5 lakhs are tax-free, thus, maximising your savings.

2. Government Bonds

When you invest in any debt funds, you are assured of making stable investments with low risk and good returns without exposing yourself to the volatility of the stock market. That is why government bonds are attractive fixed-income plans because they are government-backed securities with a low risk of defaults.

The interest rate on government bonds is calculated based on the overall period of the bond and comes with flexible tenures. Besides, the interest on all government bonds is tax-free, while the capital gains are taxable.

3. Senior Citizen Saving Scheme

For senior citizens looking to earn regular income post-retirement, investing in the Senior Citizen Saving Scheme is an excellent choice. With a flexible tenure of 15 years, senior citizens can invest up to Rs. 15 lakhs and earn higher quarterly returns to meet their short-term and long-term financial needs.

Plus, the SCSS account is transferrable across India, and one can enjoy tax savings of up to Rs. 1.5 lakhs under section 80C of ITA.

4. Monthly Income Plans

Another excellent fixed-income investment plan you can consider is the Monthly Income Plan. It is a debt-oriented mutual fund scheme that offers you regular returns every month. However, being a market-related investment product, the returns on MIPs aren't guaranteed but depend on the market performance of the fund.

Nonetheless, with better returns than FDs and no upper cap on the investment amount, MIP is an ideal investment avenue for conservative investors looking to beat inflation.

5. Fixed Deposits

Year after year, fixed deposits are one of the most preferred investment avenues for investors with varied financial goals. Both corporate and bank fixed deposits are great forms of fixed-income investment plans where you can earn higher returns while ensuring capital safety and steady growth.

The Bottom Line

With the market becoming extremely volatile over time, most investors are switching to safer investment options, and fixed-income investment plans are likely to remain a popular choice in the near future.

Apart from these excellent fixed-income investment plans, you can also consider investing in other alternative investment avenues like equity funds and debt funds for regular returns. Get in touch with a reliable financial advisor to get started with your planned investments.