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As long as you are in college, the common advice you get is: study well. But once you get a job and you start earning, the advice you get changes. Your family members advice you to start saving. Saving is good but it is more important to invest.

But with so many investment options available, it is difficult to zero in on one investment option. Also, what is the right time to invest in a particular avenue?

Well, the answer depends on various factors, one of them being the goals you set in your life. However, your life goals may vary. You may have a set of goals you wish to achieve in the next two, five, 10 or even 20 years. Based on the time limit, your investment goals can be divided into three categories:
a) Short-term goals
b) Medium-term goals
c) Long-term goals

Investment in short-term goals

A short-term financial goal can be something you wish to achieve in the next week or in the next year. Typically, the time span for short term goals is anywhere between one week and two years.

For short-term goals, it is good to earn a steady rate of return. But it is also very important to ensure you don’t lose your investment capital. That’s why investment in equities can be a bit risky as they are generally volatile in the short-term. That’s why investment in debt is quite popular among investors when the time limit is less.

Investment options for medium-term goals

Medium-term goals can range anywhere from 3 to 5 years. For example, you may want to buy a second car in the next three years. For goals like this, it is best to invest in a healthy mix of debt and equity. It is good to invest in balanced fund to get good returns and to protect capital from exposure. Investment in ELSS funds is also a good option. The best part about ELSS investments is that in addition to good returns, you can also avail tax benefits.

Investment options for long-term goals

Life is uncertain and it is always good to plan for the future. That’s why planning for a retirement that is 30 years away is not uncommon among investors.

Buying a house or funding your kid’s college education are some of the common long-term financial goals. These goals may be 10-15 years away but it is important to start investing today.

It is best to invest in equity funds, ULIPs or stocks for long-term financial goals. Investing in these avenues helps investors get great returns. For example, equity mutual funds offer anywhere between 10-15% per annum and stocks have the potential to offer much higher returns.

Investment in stocks is generally considered risky. However, the long time period helps investors to digest risks down the line. Investment in PPF funds and NPS are viable options if saving for retirement and capital preservation are your biggest goals.


With so many investment options available, it can get confusing. So, instead of asking which investment to choose, the better question is: what is the right time to choose this investment. So, based on the time period of your investment goals and your risk appetite, you can make your investment decision.


 Investment in securities market are subject to market risks, read all the related documents carefully before investing.