Best way to do savings in India?

There are quite a few options. Suggest you put a mix of things and begin investing into Mutual Funds.

• Open a PPF / NPS account. The returns are decent and secured, but there is a long time lock-in
• Open Fixed Deposits
• Start investing small amounts in Mutual Funds, start with Index funds and then into Diversified equities before going into other type of funds
• Some point when you are comfortable start into shares directly.

To begin with, let’s get one thing straight saving is not investing. However, the best way to save money is surely Investing.

There are some basic rules to save which we all know but maybe not applying. I have listed the following in brief but each and every point has equal importance.

Spend less than you Earn - It is said one should save 50% of your income. Well, If you can’t do this, save more than you spend.

Everyone must invest in SIPs as of today. Have an Investment plan. If you are ready to take a risk then do some research and invest in equity.

Avoid loans as much as possible. You plan to buy a car or a superbike in 2 years then start saving accordingly from today. You won’t regret it later. If you save the heavy interests on EMI that will be your best saving and numbers will speak for themselves.

Always try to keep your EMIs within manageable limits.

Do budgeting and keep an eye on your monthly expenses. Rightly said, one that can’t be measured can’t be controlled.

Most importantly, Pay off your outstanding credit card bill every month before the due date. Never carry a balance or pay any interest on the outstanding bill.

Do invest in Term Insurance and a Health Insurance plan for yourself and your family. Bad health or accidents never happen with a warning.

Have a separate fund for Emergency purposes for those unforeseen circumstances. If you start building your emergency fund by adding a little part of your earnings to it, you will be saved from the financial burden to quite an extent.

Eventually, all the Savings are for our old days so that we have a happy retirement phase. But, it's always advisable to Save and Plan for Retirement.

Invest in Tax Savings Instruments so that you can save the maximum. In India, the Public Provident Fund ( PPF) is the most recommended instrument. The invested amount is tax-exempt and Returns are fixed & tax-free.

I've some investments (SIP, FDs, MF) with HDFC Bank which has gained me some returns over the years.