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Best Long Term Investment Options

Updated on September 26, 2023 , 6962 views

Planning for a long term investment? But, how? Most investors look for the ‘best instrument’ to safeguard their hard earned money. But, before you invest, understanding the importance of the right investment is very significant. So, here is a list of some the best long term investment options with their investment purpose.


Top Long Term Investment Options in India

1. Public Provident Fund or PPF

Public Provident Fund (PPF) is one of the most popular long term investment options in India. Since it's backed by the Government of India, it is a safe investment with an attractive interest rate. Moreover, it offers tax benefits under Section 80C, of income tax 1961, and also the interest income is exempted from tax.

PPF comes with a maturity period of 15 years, however, it can be extended within a year of maturity for five years and more. Annual deposits of minimum INR 500 to maximum INR 1.5 lakh can be invested in PPF account.

2. Mutual Funds

A mutual fund is one of the best long term investment options in India. A Mutual Fund is a collective pool of money with a common objective for purchasing securities (via the fund). Mutual Funds are regulated by the Securities and Exchange Board of India (SEBI) and are managed by Asset Management Companies (AMC’s). Mutual Funds have gained immense popularity amongst investors over the past few years.

There are various Types of Mutual Funds like Equity Funds, Debt fund, Money market funds, Hybrid Fund and gold funds. Each has its own investment objective. However, people who look to balance risk and return, generally prefer to invest in equity and bond Mutual Funds.

The Systematic Investment plan (SIP) is also considered to be one of the best long term investment options to invest in a Mutual Fund. SIPs make an excellent tool for Investing hard earned money, especially for those earning salaries. There are various SIP calculators available in the market that try to help investors make investment plans.

Some of the best mutual funds to invest in India having Assets more than 300 Crore and having best CAGR returns for last 5 years are :

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2022 (%)
Nippon India Small Cap Fund Growth ₹117.791
↑ 1.09
Kotak Small Cap Fund Growth ₹193.889
↑ 0.99
ICICI Prudential Smallcap Fund Growth ₹65.13
↑ 0.34
Aditya Birla Sun Life Digital India Fund Growth ₹134.3
↑ 1.06
ICICI Prudential Technology Fund Growth ₹147.01
↑ 1.40
SBI Technology Opportunities Fund Growth ₹154.255
↑ 1.41
Principal Emerging Bluechip Fund Growth ₹183.316
↑ 2.03
PGIM India Midcap Opportunities Fund Growth ₹47.77
↑ 0.35
ICICI Prudential Infrastructure Fund Growth ₹120.77
↑ 0.55
SBI Small Cap Fund Growth ₹131.097
↑ 1.29
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 22 Aug 23

3. Post Office Savings Schemes

Post Office Saving Schemes are considered to be one of the best long term investment options for government employees, salaried class and businessmen. They offer a moderate rate of interest and tax benefits under section 80C of Income Tax Act as well.

Some of the most popular Post Office Saving Schemes are as follows-

4. Bonds

Bonds are a part of long term investment options. A bond is an investing instrument used to borrow money. It’s a long-term debt instrument, used by the companies to raise Capital from the public. In return, bonds offer a fixed interest rate on investment. The principle amount is paid back to the investor at the maturity period.

So, investing in long-term bonds is considered as a good alternative for earning decent returns on your investment.

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5. Fixed Deposit (FD)

Fixed deposit is a good to go as one of the best long term investment options as it is considered to be the easiest and common instrument. It is yet another option for risk-free investment. Investors can invest any amount in an FD for a maximum period of 10 years. But, the interest varies depending on the amount of investment and also the tenure.

6. Gold

Indian investors often look for Investing in Gold and it's also one of the good long term investment options. Gold is used as an Inflation hedge. Investing in gold can be done via buying physical gold, gold deposit scheme, gold ETF, Gold Bar or gold Mutual Fund. Some of the best underlying Gold ETFs in India are as follows:

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2022 (%)
Axis Gold Fund Growth ₹17.6993
↑ 0.06
SBI Gold Fund Growth ₹17.6311
↑ 0.05
HDFC Gold Fund Growth ₹18.1118
↑ 0.08
ICICI Prudential Regular Gold Savings Fund Growth ₹18.7074
↑ 0.06
Nippon India Gold Savings Fund Growth ₹23.1964
↑ 0.10
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 22 Aug 23

Whether it's buying a house, gold, car or any asset, investing is an important decision of life and also a necessity. While, each long term investment option has its own benefits and risks, plan and explore the best investment options as mentioned above and enhance your financial security.


Keep focused Financial goals and also remember while choosing best long term investment options you have to plan for a diversified investment strategy. This will minimise your risks. So, start investing a good part of your Earnings in long term investment plans!

One looking for Long Term investments in various asset classes as described above. Illustration with timeframe:

Horizon Asset Class Risk
> 10 Years Equity Mutual Funds High
> 5 Years Equity Mutual Funds High
3 - 5 Years Bonds/Gold/FD/Debt Mutual Funds Low
2 -3 Years Bonds/Gold/Debt Mutual Funds Low
1 - 2 Year Ultra Short Debt Mutual Funds/ FD Low
< 1 Year Ultra Short/Liquid Debt Mutual Funds / FD Low


All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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Rated 3.8, based on 5 reviews.

J.T.Thorat , posted on 19 Nov 22 10:23 PM

Best information, Thanks

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