21 Best Investment Options in India for 2025 with High Returns

I saved my first 10,000 rupees in 2001 when I was a student and worked part-time, playing as a DJ at wedding functions. I invested that in a Fixed Deposit because my father said that FD is the safest investment option.

I realized that FD hardly provides any return when I saw my FD value not growing after 3 years. The 10,000 rupees that I had invested had increased to just 12,000 rupees. But I was expecting my investment to grow to at least Rs. 18,000 in 3 years.

I started looking at other options that can provide 2-3x returns in a few years. I discovered risky investment avenues like – multi-level marketing (MLM) schemes, chit funds, forex trading, betting, and stock intraday trading on one hand. On the other hand found safe investments like – PPF, post office savings schemes and recurring deposits. 

I got fascinated by stocks as I could learn to analyze business and economics. I started investing in stocks after I got my first corporate job. I made the common mistake of investing in stocks without proper knowledge and ended up losing 30% of my money within a year of investing.

After this loss, I reflected on my personal financial goals. I also read a lot of books on investing and realized that targeting unrealistic returns is foolish. Also, putting all the money in one investment is also not wise.

Thereafter, I started diversifying my investments across different instruments with a target return of 15% per annum.

Before you start investing, take some time to analyze your personal financial goals – your target corpus, cash flow needs, time horizon and risk appetite. Once you are clear about your goals, you can design your investment portfolio accordingly.

I have explained in my course CashCow- how to use 3 variables to design a balanced portfolio that can give more than a 15% annual return. 

The 3 variables are –

• Existing investing experience
• Return potential of investment asset
• Associated risk

Now, let us understand a few investment fundamentals before jumping into investment selection.

How to Double Your Investment

There are no quick rich schemes that can double your money overnight. It can happen only in dreams.

But you can rely on an easy formula to estimate the amount of time taken for your money to get doubled.

The formula is the Rule of 72.

The estimated time period to double money = 72 / rate of return.

For example, if you want to calculate, in how much time will Rs. 10,000 becomes Rs. 20,000 by investing in an instrument that gives you an interest rate of 8%.

Then the answer would be, 72 / 8 = 9 years.

If you invest in something that gives 24% returns?

72 / 24 = 3 years only to double your investment

If someone promises to double your money in 2 years, then he is giving you 36% returns, which is unrealistic. Most likely it’s a scam.

Here is the list of the 21 best investment plans in India 2025

Best Investment Options for a Salaried Person in India

#1. Public Provident Fund (PPF)

Investment in a PPF account can save you a lot of tax. That is because investment in PPF for an amount up to Rs. 1.5 Lacs can be claimed as a deduction under section 80C of the IT Act.

Further, the accumulated principal and interest amount over the years are also exempted from tax at the time of withdrawal.

What We Like

• Higher interest rate than bank fixed deposit
• Returns are absolutely tax-free
• Approx. annual return = 7.1%
• Time taken to double investment = 10.14 years

Concerns

• The PPF account cannot be closed before 15 years.
• Partial withdrawal is possible only after completion of 6 years.

#2. National Pension System (NPS)

National Pension Scheme (NPS) is portable across jobs and locations. You do not have to change your NPS when you change your job or city.

The additional benefit is that you get returns from equity and debt investments as compared to PPF where you invest only in the interest-earning instruments.

All your NPS contributions up to Rs. 1.5 Lacs into Tier I capital are exempted under section 80C. In addition to that, if you self contribute then the same (up to Rs. 50,000) can be claimed as tax benefits under section 80CCD(1b).

In total a sum of Rs. 2 Lacs in tax can be saved when you invest in NPS.

What We Like

• Approx return per year = 8% to 10%
• Years taken to double the investment = 7.2 to 9 years

Concerns

• You can’t withdraw NPS fully before 60 years of age.
• Only 25% early withdrawal is permitted for certain purposes like funding your startup, buying a house, medical treatment and children’s marriage or higher education.
• Thereafter, you can withdraw only 60% which is tax-free and the rest 40% of the corpus is kept to receive a regular pension.

#3. Equity Linked Savings Scheme (ELSS)

You get a higher return of 15% to 18% when investing in ELSS. Investment amounts of up to Rs. 1.5 Lacs can be claimed as a deduction under section 80C of the IT Act.

Investment in ELSS funds have a lesser lock-in period of 3 years and any gains over and above Rs. 1 Lac only are taxable.

What We Like

• Approx return per year = 15% to 18%
• Years taken to double the investment = 4 to 4.8 years

Concerns

Treated as LTCG and earnings over Rs. 1.25 Lakh is taxed at 12.5%.

#4. Tax Savings Fixed Deposit

If you want to have a safe investment option without worrying about market fluctuations then pick the tax saving fixed deposit of any bank or post office.

The interest rates vary from bank to bank and are in the range of 6% to 8.25%.

What We Like

• Approx return per year = 6% to 8.25%
• Years taken to double the investment = 8.7 to 12 years

Concerns

• Interest earned from FD is taxable.
• There is a lock-in period of 5 years.

#5. Unit Linked Insurance Plans (ULIPs)

Investments in ULIPs give you a wealth creation option along with life cover. The premium paid for ULIPs is eligible for deduction under section 80C. Additionally, the returns on maturity are exempt under section 10(10D).

The returns vary depending on the combination of equity, debt, or hybrid funds.

What We Like

• Returns are tax-exempted
• Returns could be high if the stock market performs well

Concerns

• Lots of fees and charges (2% to 4%) like premium allocation charges, mortality charges, fund management charges policy administration charges.
• A high percentage of management charges (1.35% per annum).

Read Carefully: Why I Don’t Recommend “Insurance Policy” as an Investment Option.

Note that investment and insurance are separate assets with different objectives.

Investment assets are focused on generating returns by taking a certain amount of risk. Whereas insurance is for the protection of life and assets in case of loss and death.

Therefore, both should be considered separately and not to be combined.

Best Investment Plan With High Returns in India

#6. Stock Investment

Stock investments carry higher risks and are therefore capable of generating very high returns. Opt for an equity investment option if you are comfortable losing as much as 50% of your capital.

The last 1-year return of Nifty 50 was 19.42% and in the last 5 years, it generated a CAGR of 15.63%. Likewise, shares of blue-chip companies have delivered huge returns in the near past.

What We Like

• Approx return per year = 18%
• Years taken to double the investment = 4 years

Concerns

• High-Risk factor

To invest in equity, you need a Demat account. You can read the full reviews of my favorite Demat accounts to pick the right one as per your requirements.

• Zerodha Demat account review for the best Demat account with free stock delivery.
• Upstox Demat Account Review for free account opening with zero annual maintenance charges.

#7. Mutual Funds

Mutual funds are the most convenient way of investing in the stock markets when you do not have the time and expertise.

Equity mutual funds have generated consistently higher returns. Funds like Nippon India Large Cap, HDFC Top 100 Fund and ICICI Prudential Bluechip Fund have delivered 3 years returns in the range of 15% to 19%.

You can do a lump sum investment in mutual funds or do a monthly SIP for an amount as low as Rs. 500.

What We Like

• Approx return per year = 14 to 16%
• Years taken to double the investment = 4.5 to 5.14 years

Concerns

• High-risk factor or price movements
• Affected by market movements in NSE/ BSE
• Fund houses charge expense ratio (1% -2%).

#8. Commercial Real Estate

Commercial real estate provides rental income and capital appreciation. The higher appreciation is due to the demand for office space with the growth of the corporate environment.

But the real estate location, building quality, market space rent and the demand-supply play a major factor in deciding returns.

A good investment in office and shop spaces not only fetches higher returns but also helps in the diversification of investment assets.

What We Like

• Approx return per year = 12%
• Years taken to double the investment = 6 years

Concerns

• Selling real estate takes time.
• Returns differ from property to property based on location.

#9. Initial Public Offer (IPO)

The best part of investing in an IPO is that the money gets blocked only for 3 to 10 days. Prudent investment in a good company coming out with an IPO can fetch returns as high as 20% – 50% over a period of time.

What We Like

• Approx return per year = 20%
• Years taken to double the investment = 3.6 years

Concerns

• Very high risk.
• Subject to market movements & company performance

Best Investment Plan for 1 Year in India

#10. Fixed Deposit

FDs are the safest and most secure investment options provided by banks and post offices which earn higher interest rates than a savings account.

Any excess amount that you are not going to use for a certain period of time can be safely put into a fixed deposit.

Bank vs. Post Office Fixed Deposits

Particulars	Bank FD	Post Office FD
Interest Rates	2.75% to 8.25%	6.9% to 7.5%
Time to double investment	8.7 to 26 years	9.6 to 10.4 years
Tenure	7 days to 10 years	1 to 5 years
Min deposit amount	Vary from bank to bank	Rs. 1,000
Tax benefit	On a 5-year tax saver	On 5-year tax saver

#11. Liquid Mutual Fund

Liquid mutual funds carry the least amount of risk and are for persons who have idle money for a short period of time.

The liquid mutual fund invests your money in highly liquid short-term instruments like the bank’s CD, T-bills and commercial papers with a maturity period of less than 91 days.

What We Like

• Approx return per year = 5%-6%
• Years taken to double the investment = 12 to 14.4 years

Concerns

• Lower returns when compared to FD

#12. Ultra Short-Term Debt MF Plans

Here the money is invested in bonds and other interest-bearing instruments with a maturity period of more than 91 days but less than 1 year.

Ultra ST debt MF does carry interest rate risk and is not so liquid and hence it gives you higher returns.

What We Like

• Approx return per year = 7%-8.5%
• Years taken to double the investment = 8.4 to 10.3 years

Best Investment Plan for 3 Years in India

#13. Equity Linked Savings Scheme (ELSS)

There are numerous benefits when you invest in ELSS like – tax savings, higher returns (15% to 18%), option to invest monthly (SIP) that can be started with as low as investing Rs. 500 per month.

What We Like

• Approx return per year = 15%-18%
• Years taken to double the investment = 4 to 4.8 years

Concerns

• Lock-in period of three years.
• Returns are treated as LTCG and any gains over Rs. 1.25 Lakh are taxed at 12.5%.

#14. Fixed Deposit

Returns on a 3-year FD vary from bank to bank, usually in a range of 6% to 8.25%. However, there are no associated tax benefits in this investment option.

What We Like

• Approx return per year = 6% to 8.25%
• Years taken to double the investment = 8.7 to 12 years

Concerns

• Returns vary, some banks offer lesser returns for 3 years FD.

#15. Recurring Deposit (RD)

The returns generated from recurring deposits are almost the same as a fixed deposit for a 3 year period.

What We Like

• Approx return per year = 6% to 8.25%
• Years taken to double the investment = 8.7 to 12 years

Best Investment Plan for 5 Years in India

#16. Direct Equity and Equity-Oriented Mutual Funds

Equity is the best option for persons looking for growth and building wealth corpus. The returns on individual stocks are high (>20%) for fundamentally strong and growing companies over a longer period of time.

For example, Hindustan Unilever generated a 5-year CAGR of 33.33%.

But note that huge returns come with high risk, and a bad stock selection can erode more than 50% of your capital. When you are not sure then the best way to invest in stock is – investing through mutual funds.

If you don’t like market fluctuations, then you can invest in index funds and expect stable returns matching the underlying index.

If you don’t have a demat account, then choose one from the list of best demat and trading accounts in India.

What We Like

• Approx return per year = 14 to 16%
• Years taken to double the investment = 4.5 to 5.14 years

Concerns

• High-risk, high-return investment.

#17. Investment in Gold

Over the years, investment in gold has given consistent returns of around 8% – 10% beating inflation and providing diversification. A better way to invest in Gold is through a Gold mutual fund, Gold ETF and Gold bonds.

You can also invest in Sovereign Gold Bond Scheme (SGB bonds) regulated by the government and RBI. You will own gold in ‘certificate’ format. The value of the bonds is assessed in multiples of the gold gram. The initial minimum investment is 1 gram of gold.

You would earn 2.5% interest per annum on the amount invested. The Lock-in period is 8 years.

What We Like

• Approx return per year = 10%
• Years taken to double the investment = 7.2 years

Concerns

• No tax benefits.

#18. Real Estate – Residential

The investment in residential real estate generates regular rental income and appreciation with a modest amount of risk as compared to equity investments.

The growth in residential real estate investments is due to individuals looking for better urban housing needs and government housing initiatives.

You benefit by owning an asset, adding diversification to your investment portfolio and even saving on taxes (exemption benefits through housing loans & depreciation).

What We Like

• Approx return per year = 10% – 11%
• Years taken to double the investment = 6.5 to 7.2 years

Concerns

• Difficult to sell property quickly in case of urgent money needs.
• Returns depend on property, location and other infrastructure developments in nearby regions.
• High political involvement.
• A small change in government policy may make a big difference in the valuation of property.

#19. National Savings Certificate (NSC)

NSC is a low-risk, fixed-income instrument that can be easily opened at any post office. National Savings Certificate comes with two fixed maturity periods of 5 years and 10 years.

You are free to invest any amount in NSC, but investments only up to Rs. 1.5 Lac helps you with tax deductions. The interest earned over the period of time is not tax-free.

The earnings are 7.7% p.a. NSCs can be pledged with banks for taking loans.

What We Like

• Approx return per year = 7.7%
• Years taken to double the investment = 9.35 years

Concerns

• Lower returns as compared to mutual funds.

#20. Tax Saving FD

Tax saving FD option gives complete capital protection with additional interest income for 5 years at a rate similar to 5 years FD.

However, premature withdrawal is not allowed (except in case of death) and the interest earned is taxable.

What We Like

• Approx return per year = 6% to 8.25%
• Years taken to double the investment = 8.7 to 12 years

Concerns

• No premature withdrawal is possible.
• Can not pledge to take loans.

#21. Bonds

Bond investments are better if you are looking for principal protection, steady income, or tax savings. Investments in the bond can be done through AAA-rated bonds by PSU, Govt. and Corporate NCDs.

Long-term debt investments can generate steady returns over inflation but they carry interest rate risk.

What We Like

• Approx return per year = 7% to 10%
• Years taken to double the investment = 7.2 to 10.3 years

Concerns

• Interest rate risk.
• Interest earned is taxable.

Basic Things to Keep in Mind Before Investing

#1. Investment Goals & Expected Returns

You should know the purpose for which you want to invest, it can be anything from creating a retirement corpus, marriage of children, buying a house, vacation, or luxury car.

Knowing your goals helps you plan realistically and keeps you committed to your investment track.

When you know your goals, selecting investment options becomes easy. In a sense, you know the returns given by each option and the kind of investment you need to pick in order to achieve your goals.

#2. Check Investment Period

Returns or earnings are not possible overnight. You need to look for a matching time period where your money can grow sufficiently to fulfill your desired goal.

#3. Assess Your Risk-Taking Ability

Even after knowing your goals you should not invest hastily in assets that give the highest returns within the lowest time period.

Your investment decision should depend on the risk factors and your risk-taking abilities. Both factors differ from person to person.

For example, an individual fresh at a plush job would not mind losing Rs. 25,000 on equity investment. Whereas the same amount is sufficient for an old person to meet his monthly expenses and the amount needs to be preserved.

A salaried person may have different financial needs than that of a business person. Hence, they have different risk-taking abilities and they face different risk factors.

#4. Associated Charges With Investment

Opening a PPF or an FD will cost you Rs. 0. You just have to do it online or go to your bank and place a request to open an account.

But for stock investment, you have to open a demat cum trading account with a stockbroker. Most of them allow free account opening like Zerodha. But you have to pay an annual maintenance charge (AMC) of up to Rs. 700 every year.

#5. Own Research and Management or Professional Help

You need to do proper research before you invest in stocks, IPO, or find out a mutual fund scheme. Research can be tedious and time-consuming, especially for beginners.

You can learn and do your own research or take the help of professionals for research and management.

Grow Wealth With the Power of Compounding

We have heard the word compounding right from our school days. But very few have effectively used the power of compounding for long-term wealth creation. You might be surprised if you let the magic work over a period of time.

Compounding is simply- earning interest on the principal, reinvesting all the earnings and then getting not only interest on the principal but also interest on interest from the next year onwards.

In a way, compounding, helps you build a large corpus over a period of time even with a small initial investment.

But for the magic to happen, you require two things. One is starting early and the other is continuing reinvesting over a long time period, say 10 years to 20 years.

The more you let that happen the more you amass wealth.

Let us see how

Suppose today you invest 1 Lac at a compound rate of 8% and kept reinvesting all the earnings. Then after 10 years, the money will become Rs. 2.15 Lacs,  then turn into Rs. 4.66 Lacs after 20 years, and then Rs. 10.06 Lacs in 30 years.

In the initial period, you see that the earnings are not as much but in the later years, the earnings increase exponentially. Which is due to the compounding effect.

Starting early allows more time for the magic, i.e. compounding to happen. Let us see three scenarios.

The goal is to accumulate a corpus of wealth by the age of 60 years. Investment amount Rs. 1 Lac every year and assuming that the compound interest rate is 8%.

Scenario 1

Investing every year from age 20 to 40

Rs. 2.13 Crores corpus at 60 years

Scenario 2

Investing every year from age 30 to 50

Rs. 0.99 Crores corpus at 60 years

Scenario 3

Investing every year from age 40 to 60

Rs. 0.46 Crores corpus at 60 years

You can see that the results are strikingly different even when the investment is for 20 20-year period in each scenario.

You build a corpus of Rs. 2.13 Crores just by starting early at the age of 20 years as compared to Rs. 46 Lacs when starting late at the age of 40 years.

This is because you get an extra time period of 20 years for the money to get compounded.

In this way, compounding amplifies the growth and maximizes the earning potential of your money.

Final Words

I have explained all the different types of investment plans available in India.

Lack of knowledge regarding investment options should not be a reason for you anymore to start investing. There are many lucrative investment options, so do not put all your eggs in one basket.

Frame your investment goals, define your risk capacity and chalk out an investment plan best suited to your needs. The best would be to put your plan on paper or an Excel sheet.

Take control and stay committed to your financial goals. And trust me, you will gain the power to change your fortunes by using the power of compounding!

If you have any queries, let me know in the comments.

FAQs

Where can I invest Rs. 20 Lacs lumpsum to get 12% to 14% returns in 5 years?

Stock investment or Mutual fund investment has the potential to generate 12% to 14% returns over a period of 5 years. You need to do proper research before you invest.

Which investment option provides compounding? 

All the interest-bearing instruments like FD, PPF and RD that reinvest the money, compound over the time period.

Whereas, investment in shares and mutual funds appreciate in value (price) over time.

What are the best options to invest for people retiring to get regular risk-free returns?

Senior citizens should look at investment options like – FD, RD and SCSS (senior citizen savings scheme) for risk-free returns. All the options are backed by banks or by the government.

Which is the best investment option for students?

Assuming, students don’t have a regular income, the best investment option will be:

• PPF – risk-free investment requiring a minimum Rs. 500 investment per year
• Stocks – long-term wealth building, no minimum investment amount
• Equity Mutual Fund – in case you don’t want to research & manage investment

How to start with Financial Goal Planning?

You need to work out on the following points:

• Setting a tangible investment goal
• Knowing your risk-taking capacity
• Check the time in which you want to fulfill your goal
• Whether you want to do on your own or take professional help

Which investment gives the highest returns in India?

Running after the highest returns is a fool’s paradise. High returns come with high risks.

Rather you should be reasonable. Selecting investment that generates returns that can help you achieve your financial goals. That too without hurting your risk-taking ability.

What investment is 100% safe?

None of the investment options is 100% full proof. Risk and Returns are directly proportional to each other.

FDs, PPF, and Government bonds look safe because they are all the time backed by Banks and GoI. Still, they carry a small amount of risk of failure.

How to get a 20 percent return on investment?

Investment in high-growth stocks will help you get a 20 percent return on investment over a longer time horizon. But they also carry high risk.