Ways to Double Your invested Money

Effective Ways to Double Your Money

• Mutual Funds: There are various types of mutual funds. ELSS (Equity Linked Savings Scheme), equity-oriented, debt-oriented, and balanced mutual funds are a few examples. Mutual funds offer a higher rate of return than other investment options, despite the market risks. So, you can consider it as one of the most effective ways to double your money. Moreover, the tenure of mutual funds will determine their rate of return. As a rate of return, long-term mutual funds can offer rates between 12% and 15% per year. With these mutual funds, it may take between 5 and 6 years to double your money.

• Kisan Vikas Patra (KVP): It comes under the Post Office Small Saving Scheme. It was stopped but restarted in the first quarter of 2015-16. The Indian Government revises the interest rates and tenure to increase the money every quarter. The interest rate for KVP for April -June 2021 is 6.9. 

• Corporate Bonds: Bank deposits don't offer a high rate of interest. If you are looking for a high rate of interest on your investments, corporate bonds can be the way to go. The credit score and market credibility of corporate FDs or NCDs will determine the interest rates offered.

• National Savings Certificates: The Indian Postal Department issue National Savings Certificates (NSC). It is one of the most secure investment options. These certificates come with a fixed tenure of five or ten years and a fixed rate of interest. The rate of interest for NSCs with a 5-year term is 8.5% per annum. For NSCs with 10 years, the interest rate is 8.80% per year. National Savings Certificates are exempted from income tax under Section 80C, Income Tax Act 1961 up to Rs 1,50,000. TDS is not charged on amounts received at maturity. NSCs can also be used to obtain loans from any bank.

• Tax-free Bonds: In the past, tax-free bonds were only issued for a limited time. The Government granted permission to a few state-operated bodies to erect these bonds for INR 40,000 crore. These NTPC and PFC tax-free bonds are high in demand. For the 2015 series, the tax-adjusted return or interest rate offered by tax-free bonds was between 8.20% and 8.50% per annum, based on tenure. This bond can double your money in approximately 8 to 9 years.

• Gold ETFs: People usually love purchasing Gold. Gold has delivered consistent returns of about 10%. You can also invest in Gold ETFs and Gold Bonds to make gold investments more worthwhile. You can also make investments in the Sovereign Gold Bond Scheme. The RBI and the Government regulate the scheme. The certificate format will allow you to own Gold. Moreover, bonds value is determined in multiples of one gram of Gold. The minimum initial investment is one gram. On the amount you invest, you would receive 2.5% interest per year. The lock-in period for the amount invested in eight years. It would take about eight years to double the money you invest in Gold ETFs. 

• Real Estate: It is also one of the effective ways to double your money.  You can generate a regular rental income by investing in residential real property. You can own an asset, diversify your portfolio and save taxes. In 6 to 7 years, your property's value can double. The catch is, real estate investment requires huge capital to invest. Multiple factors influence the return, including location and infrastructure development in neighboring areas.

• Stock Market: Stock investing is one of the great ways to double your invested money and build wealth. Direct stock investments carry high risks, so much so that you can lose up to 50% of your investment. However, the returns are equally high. On the flip side, returns on individual stocks are high (>20%) for big companies over longer periods. Eicher Motors Limited, for instance, made a five-year CAGR of 28.77%. In 3.5 years, you can expect to double your wealth. You should still invest in stocks for the long term (five years or more).

• Public Provident Fund (PPF): A minimum of INR 500 per year is required to invest in PPF. This scheme has a 15-year lock-in period. This plan offers the lowest possible contribution compared to other savings plans. Salaried, self-employed, and government employees can avail of this scheme. For each year in the fund, the rate of return is 8.75% per year. In 8 years, your invested money may double.

Final Word

There are several ways to double your invested money. Consider your affordability before finalizing a choice. Debt mutual funds are the safest bet on the above list, while equity funds being the riskiest.