Women Investment Options in India

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Women today are increasingly aspiring to become financially independent. Millennials and Gen Z women are taking on ambitious careers - and succeeding amazingly well. Personal finance for women is taking center stage. And investments, as you will no doubt agree, are of great importance for women who wish to secure their future financially.

Now, if you’re a woman who is looking forward to charting out a solid financial plan for your future, it can help if you’re aware of the best investment options for women. That’s just what we’re going to be looking at in this chapter.

Investments can help you make the leap from mere capital preservation to capital appreciation. After all, that’s how you create wealth, right? So, without further delay, let’s take a closer look at the top investment options for women in India.

Gold

Well, this was quite obvious, wasn’t it? Gold has long been considered to be one of the best investment options for women due to its ornamental value. That said, ornament or not, gold always makes a good addition to your investment portfolio. It is an inflation-beating investment option, with a known record of value appreciation. And since gold is considered to be a safe-haven asset, it also makes for a good option during times of market volatility.

Mutual funds

Women have typically been considered as conservative investors who are averse to taking on market risks. While it used to be true to a certain extent, things are changing now. Younger, working women don’t seem to share the same conservative investment mentality. And they’re far more open to taking moderate levels of risk.

In fact, a survey conducted by Groww showed that as many as 82% of women preferred to invest in stocks and mutual funds. Mutual funds give you the ability to create wealth over the long-term and also provide you with the necessary diversification needed to reduce investment risk. The capital appreciation that mutual funds provide during times of favourable market movement is virtually unmatched.

Equity

Alternatively, if you're not a beginner to the world of stock trading, you could also consider investing in direct equity instead of mutual funds. One of the primary advantages of investing directly in the stocks of companies is that you get to create a more customized investment portfolio suited to your needs and requirements. However, before investing in direct equity, always ensure that you conduct thorough research on both fundamental and technical aspects of the company.

 

Women-centric life insurance

What can be more appropriate investment options for women than women-centric life insurance products? Nowadays, most leading life insurance service providers have come up with products that specifically cater to women. These life insurance products offer coverage for many diseases that affect women only, such as breast cancer, ovarian cancer, and the like. They also give women the benefit of lower insurance premiums, given that women have longer average lifespans than men. As for health insurance products, they’re now covering maternity costs and catering to women-specific complications and illnesses including those that arise from child-birth.

Public Provident Fund

If you’re looking for safe, secure, and high-interest paying long-term investment plans for women, look no further than the good old Public Provident Fund (PPF). It is backed by the government of India, has a 15-year lock-in period, and provides returns at a very attractive rate of interest - one that’s higher than most bank deposit rates currently in the market. Also, the interest income is exempt from tax, and the investments themselves can be claimed as deductions under section 80C of the Income Tax Act, 1961.

Real estate

Real estate has long been viewed as something that only men would invest in. However, the times have changed drastically, and an increasing number of women are adding real estate investments to their portfolio. Considering the potential for high capital appreciation and the ability to earn passive income by way of rent, real estate could be the best investment plan for women. Also, with real estate, you don’t always have to have a lump sum amount waiting to be invested. You could take a home loan to fund your real estate investment as well. Or, you could simply invest in REITs.

Sukanya Samriddhi Yojana (SSY)

How can we discuss investment plans for women and not count Sukanya Samriddhi Yojana among them? It is one of the government of India’s flagship investment schemes that caters to saving up for the future of the girl child. The scheme can be availed by parents of girl children below 10 years of age and has a long lock-in period of 21 years!

So, if you have a girl child, you can invest up to Rs. 1.5 lakh each year in this scheme, and claim the same as a deduction from your total taxable income. The rate of interest is also quite attractive, currently at 7.6% per annum, making it one of the best long-term investment options for the future of girl children. Keep in mind that you will need to open an SSY account before your child turns 5.

Wrapping up

Now that you know what the best investment options for women are, go ahead and start your investment journey right away. And if you’re worried about taxes eating into your investment returns, the next chapter on women and taxes might be of some help. Check it out to learn about the key things you should keep in mind about taxes.

A quick recap

  • Investments can help you make the leap from mere capital preservation to capital appreciation. 
  • Gold always makes a good addition to your investment portfolio. It is an inflation-beating investment option, with a known record of value appreciation. 
  • Mutual funds and equity are other high-risk-high-reward options to consider.
  • Women-centric insurance products also make a good addition to the portfolio. 
  • Other notable investment products for women include PPF, real estate and the Sukanya Samriddhi Yojana (SSY).

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FAQ'S

A real estate investment trust (REIT) is a company that invests in commercial, income-generating real estate. Some examples of the assets REITs invest in include offices, apartment buildings, hospitals, warehouses, and shopping centers. You can invest in units of REITs, thereby investing in commercial real estate.
The different ways to invest in gold include physical gold, digital gold, gold mutual funds, gold ETFs, and sovereign gold bonds.
Parents of girl children can open a maximum of two accounts, one for each girl child. However, in case a parent has triplets, or has one girl child followed by twins, more than two accounts can be opened.
The annual investment amount of the PPF scheme ranges from Rs. 500 to Rs 1.5 lakh per year.
It is a fixed income investment scheme in the form of a savings bond that can be opened with any post office. Investors receive interest on their investments at a predetermined rate.
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