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Safest Investment Options 2024

Safest Investment Options 2024
February 19, 2024


The Safest Investment options are those that can help you grow your wealth with minimum risk involved. To achieve a better and financially secure future, everyone needs to invest and grow their wealth. But among the several investment plans to help you save or invest, not everything guarantees a stable return. So, whether or not you have a low-risk appetite, if you are looking to build a corpus for your future, the trick is to choose the safest investment options that assure a solid fund.

But how do you pick out the investment opportunities with no or nominal risk? Let us help you with the choice of the safest investment options in India. 

10 Safest Investment Options in India

If you are planning to grow your wealth, there are a large number of investment avenues available, a section of which are risk-free ones, operating on fixed-income instruments, while the rest are market-linked with varying degrees of risks involved. Here one needs to choose the option that best fits his/her agenda. For that, it’s crucial to analyse one’s requirements and risk appetite. If you fall in the category of risk-averse investors, it’s important to stick to the safest investment plans. 

Safest investment options to choose from -  

1.Fixed Deposit (FD)

Offering a much higher interest rate than a regular savings account, fixed deposits with banks are still considered one of the safest investments. This is because, here your money is locked in for a pre-specified term at interest rates varying over the amount and tenure of deposit, the bank and the residential status of the account holder. The one-time investment stays safe with the bank, with hardly any probability of defaulting. Specific 5-year tax saving deposits also offer you tax deductions up to Rs 1.5 lakh a year under section 80C of the Income Tax Act 1961. Thus, features of this investment option include guaranteed returns and remains the best pick for those with low-risk appetite. Facilities like partial withdrawals and loans against deposits are also available. 

2.Life Insurance

Life Insurance plans are one of the most prevalent and safe investment options available out there. With a life insurance you get a maturity amount at the end of your policy tenure and get a life cover to secure your financial future. Life Insurance also helps you save tax as per prevailing tax laws u/s 80C of the Income Tax act, 1961.

3. Public Provident Fund (PPF)

A government-backed investment scheme, the Public Provident Fund (PPF) allows you to save any amount within the range of Rs 500 to Rs 1.5 lakh per year and enjoy full tax exemption under section 80C of the Income Tax Act,  1961. With the backing of sovereign guarantees and assured returns without any link to the market, PPF continues to be a popular choice for growing your wealth, offering compound interest at 7.1% currently. The scheme comes with a 15-year lock-in period with partial withdrawals allowed from the 7th year onwards under specific circumstances, making it a great long-term investment opportunity. You can choose to either receive the full corpus or extend the deposit for 5 more years upon maturity.

4. National Pension Scheme (NPS)

Are you a risk-averse individual worrying over your retirement, looking to create a corpus or ensure a steady flow of income in retired life? The National Pension Scheme can be a wise choice because it enables you to build a corpus over a long term by investing your money into a portfolio of liquid funds, corporate bonds and fixed deposits to fetch returns as high as 10-14%, in a government-managed mechanism. It also offers tax benefits in terms of a total deduction of Rs 2 lakh under sections 80C and 80CCD(1B). Any Indian employee can open an NPS account, choose a preferred portfolio and invest till retirement. Upon maturity, a portion of the corpus can be received as a lump sum and the rest has to be used in buying an annuity plan that would ensure a monthly income in your retired life. 

5. Gold

For ages, gold has been considered a safe investment. Buying gold jewellery, bars and coins or investing in sovereign gold bonds or gold ETFs doesn’t just contribute to wealth but can aid you in hedging inflation as gold prices has an inverse relationship with the stock market. Moreover, as gold pricesdon’t go down considerably over time, it also ensures capital protection.

6. Savings Bonds

Introduced in 2018, the GoI savings bond offers an annual interest at 7.75%. Wrapped in sovereign guarantees, these bonds help you retain and secure your capital. On the other hand, while you can start with an investment as nominal as Rs 1000, the interest rate ensures guaranteed returns and growth of your money.

7. Recurring Deposits

Alongside FD, another option of a bank-led investment scheme is recurring deposits. In this, you invest a fixed amount of money in a pre-defined schedule at a much higher interest rate, compared to regular savings accounts. Thus, while RD helps inculcate a habit of saving, returns are assured too as there’s no link to the market. Recurring deposits also enable one to start with a small sum of investment.

8. National Savings Certificate

Purchasable at banks and post offices, the National Savings Certificate (NSC) is a government-backed fixed-income investment scheme. Here, one has to invest at least Rs 1000, followed by multiples of 100 in 12 equal investments or make the entire deposit in one go. With a lock-in period of 5 years, NSCs provide interests at maturity at a rate fixed by the Ministry of Finance. The investment also fetches you tax deductions up to Rs 1.5 lakh under section 80C. 

9. Post Office Monthly Income Schemes (POMIS)

The Post Office Monthly Income Scheme (POMIS) is offered by the Indian Post. Single, Joint, Guardian of someone with unsound mind or minor account options are available to invest a minimum of Rs 1000. The maximum permissible amount for investment is Rs 4.5 lakh for a single account and Rs 9 lakh for a joint account, respectively.

10.  Senior Citizen Savings Scheme (SCSS)

Senior Citizen Savings Schema (SCSS) is a scheme by the Government of India specially designed for investors over 60 years of age. It has a guaranteed rate of return that provides a steady income stream and tax benefits, making it a low-risk option. Generally, the SCSS offers a higher interest rate than other options, making it a good option for senior citizens.

FAQs on the safest investment option

Q. What is the safest option for investing?

Fixed deposits with banks are still considered one of the safest options for investing. Here, you get to accumulate money at a much higher interest rate compared to regular savings accounts. Here, the fund remains secured and offers a guaranteed return upon maturity.    

Q. Is there a 100% safe investment?

Nothing can be considered a 100% safe investment. However, a Public Provident Fund with guaranteed returns at compound interest is termed as one of the safest choices of investment in India as it is a government-backed scheme and has no link to the market.   

Q. Which fund has the lowest risk?

The funds which let you invest in a diversified portfolio and have a strategy that focuses on downside protection offer you the lowest risks. It’s ideal to check and compare fund options from different banks and financial institutions to arrive at a choice that fits your requirements and risk-taking ability.  

Q. How can I minimize my investment risk?

One of the best ways to minimize investment risk is to diversify your portfolio and choose a mix of asset classes. Here the high risk-high gain assets like equities will be balanced by the low risk-low gain assets like debts and fixed income instruments. Consequently, losses, if any, will be offset by the gains from the other side.  

Q. What are the safest tax-saving investment options available in India?

The most popular among the safest tax-saving investment options in India include:

  • Public Provident Fund
  • National Savings Certificate
  • Life Insurance Plan
  • Equity Linked Savings Scheme (ELSS)
  • Sukanya Samriddhi Yojana

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ARN – ED/12/23/7149

Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

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Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

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