Top 10 Investment Plans for Students

A skyscraper is not considered tall unless it is built from the ground up. Investing works in a similar way. The more years you invest the better your chances of reaping a substantial profit. In today’s world having a side hustle is crucial for students. But what if instead of just doing a band gig or collaborating on Instagram you could also learn about investing and earn some extra money along the way as a student?

Also Read: Raising Funds for an Emerging Startup

While the idea of investing may seem daunting at first smart and careful investments can take you to new heights. Many young people are unsure where to invest when they start out. If you’re a student looking to embark on your investment journey this is the ideal starting point. Keep reading to discover the top 10 investment plans for students and get ready to kickstart your successful financial adventure!

Benefits of investing early

As students, we don’t really have a lot of money to invest. So it’s best for us to put our money in safer options to avoid losses. You can also start with a small amount at a young age. This can bring great rewards later. Warren Buffet the famous billionaire, was already investing at just 11! It’s never too soon to start investing! College students are in the perfect age to start their investment journey. Before we go into the details of what, where, and how let’s explore some of the fantastic advantages of starting to invest as a student.

• More time to take risks: Students have the ability to take more risks, as investors compared to adults who have numerous personal and professional responsibilities. They can recover from losses more quickly since they possess the most valuable asset, for succeeding in the investment world – time. This also gives students the opportunity to gain valuable experience and thoroughly learn money and risk management before stepping into the financial realm.
  
  
• Setting the stage for success: By starting your investment journey at this age you increase your chances of achieving financial independence earlier than those who wait for a job opportunity. Consistent investing also enhances your skills in budgeting and saving. While it’s crucial for students to learn the art of saving money making small investments is equally important. This approach allows you to learn from your missteps and broaden your understanding, in areas like asset allocation diversification and stock analysis.
  
  
• Increased potential for compounding: One of the advantages of investing as a student is the ability to let your money grow, over an extended period. With a more aggressive investment strategy you can gradually build a solid portfolio by considering higher risk assets such as high growth stocks. So, if you’re in college with a job it’s wise to start parking your money and securing your future, at this age.

Top 10 safe investment plans for students

Before making your first investment in any asset as a student it’s crucial to prioritize learning how to invest. Every investment you make should be meaningful. Here are 10 investment strategies for students.

1. Try your hand at the stock market: Putting a small amount each month into stocks is an excellent way to earn passive income online. Nowadays many platforms offer systematic investment plans making it easier than ever. You can begin by investing in well-established blue chip stocks from the Nifty 50 or Nifty Index which showcases India’s top 50 companies. Options like exchange-traded funds such as gold ETFs, Nifty 50 ETF, or Nifty Next 50 ETF are some of the safest choices for novice investors in the stock market.
   
   
2. Mutual funds: You can kickstart a SIP (Systematic Investment Plan) in mutual funds with just Rs. 100. If you’re unsure about which fund to select consider starting with large cap or index funds. You can also look into other assets.
   
   
3. Unit Linked Insurance Plan (ULIP): They can give you plus points for both insurance and investment. This option provides students with flexibility and is more cost-effective compared to alternatives.
   
   
4. Bonds: Bonds are debt securities issued by companies or governments that can be traded as assets. With a fixed interest rate and a set duration, they are considered one of the best options for generating income. This can provide a reliable source of passive income for students.
   
   
5. Fixed Deposit: Recently we have seen an increase in bank interest rates. Thus, it means is it now a good time to save your money in fixed deposit accounts. This allows you to make an emergency fund. When you start earning you will thus have a stronger financial position.
   
   
6. Derivative Market: Investing in markets can enhance students’ knowledge about various underlying assets. They can gain insights into price movements and factors influencing supply and demand. This understanding will empower them to make investment decisions in the future.
   
   
7. Life Insurance: Life insurance is a savings option, for those with multiple financial needs. Students can pay the premium for a specific period and receive returns or market linked returns at maturity along with the regular life coverage benefit.
   
   
8. Public Provident Fund or PPF: This is a long-term investment choice offered by the Government of India. The profits are exempt from taxes making it an option for young investors looking to grow their savings over time.
   
   
9. Peer to Peer Lending: These platforms connect you directly with borrowers and other individual lenders bypassing traditional financial institutions. This can result in returns compared to regular savings accounts. But it is also very important for you to research and diversify your investments. This will keep away the risk of defaults.
   
   
10. Real Estate Investment Trusts or REITs: These are companies that manage or finance income-generating real estate properties. They provide an opportunity to enter the market without owning properties directly. You might consider investing in publicly traded REITs available on stock exchanges, where you can purchase shares and earn from rental income.