Top investment ideas to make 2025 brighter: Gold, MFs, FDs and property

The World Bank feels the Indian economy is "well placed" to deal with any potential global setbacks in 2025. Predicting a steady GDP growth rate of 6.7% for the financial years 2026 and 2027, 2025 could be a critical year for Indian investors.

But there is no best way to invest money; the trick is to find the best investment ideas that align with your investment goals and risk profile.

Below are four investment ideas for you to explore in 2025.

Investment idea #1: Investing in gold
 

Gold has been coveted across the globe for centuries for religious, social and investment purposes. In India, the world's second-largest gold consumer, it is considered auspicious.

The inherent value of gold stems from several key factors, these being –

1. Its sentimental value
2. Its availability, gold mining being controlled
3. Its longevity, as it doesn't fade
4. Its store of value (i.e. it doesn't depreciate)
5. Its liquidity
6. Its usage in the electronics industry, today inseparable from daily life
7. It appeals to central banks globally and institutional and retail investors

Pros and cons of investing in gold
 

Gold's inherent quality as a hedge against inflation and market fluctuations makes it one of the best investment options. This is because when the markets fail, gold prices rise. This makes it a haven investment during downturns (such as the pandemic when stocks tumbled).

During the global meltdown in 2008-10, gold outperformed "alternative investments" such as commodities, hedge funds and real estate, as per the World Gold Council data. This makes gold an effective diversifier.

But gold may not be the best investment plan with high returns always. Gold jewellery may be a liquid asset, but the high-making charges are not recovered on resale. Similarly, management charges and brokerage make gold ETFs costlier than physical gold.

Gold prices fall globally when the dollar slides, including in India. Another drawback is that storage and safety are major issues with physical gold holdings.

Factors affecting the price of gold 
 

Apart from dollar rates, demand and supply play a significant role in impacting gold prices. High inflation raises demand for gold, hiking gold prices. Rates also rise when interest rates fall, as people buy gold instead of looking at interest earnings. Other factors include gold import duty rates, wedding season, and the government's gold holdings.

Tips for investing in gold
 

To make gold one of the best investment options, decide on a short timeframe for liquid assets like gold ETFs and a long timeframe for more illiquid gold. Also, decide on investment amount, and plan diversification among gold types/instruments. 

Finally, learn to spot the extra charges associated with physical gold.

Investment idea #2: Investing in mutual funds (MFs)
 

A mutual fund is a pool of money collected from multiple investors and reinvested in various instruments, such as equities, bonds, etc., for diversification. Mutual funds are among popular investment ideas because they target one of three objectives—capital appreciation (growth), income, or preservation.

Types of mutual funds 
 

There are various types of mutual funds, such as –

1. Equity funds – These MFs invest in company stocks and are perfect for long-term wealth creation
   
   
2. Debt funds – These funds invest mainly in fixed-income securities such as bonds and T-bills and are ideal for risk-averse investors
   
   
3. Hybrid funds – These invest in both stocks and bonds and are a balance between equity funds and debt funds
   
   
4. Tax-saving funds – Popularly known as Equity Linked Saving Scheme (ELSS), these enjoy tax benefits and also generate returns of 14%-16%

Pros and cons of investing in mutual funds 
 

Mutual funds have their pros and cons. On the plus side, they offer –

1. Professional fund managers
2. Diversification
3. Affordability
4. Liquidity

On the downside, they have –

1. Annual fees and expenses 
2. Lock-in periods and exit loads

​​Factors to consider before investing in mutual funds 
 

Each mutual fund has an objective—growth or value. The other factors to consider are –

1. Time horizon
2. Risk tolerance
3. Fund performance
4. Net Asset Value
5. AMC performance
6. Expense ratio (i.e. the fees)
7. Exit load

Tips for investing in mutual funds 
 

Mutual fund investments involve significant financial commitments, so select the best investment option with defined goals and long-term returns. Aim for a diversified portfolio; it helps gain the best investment plan with high returns. You can also develop a long-term investment perspective, as mutual funds are not get-rich-quick schemes.

Investment idea #3: Investing in fixed deposits (FDs)
 

A fixed deposit is an instrument offered by banks and NBFCs, where you park a lump sum amount for a fixed tenure at a fixed interest rate. When the tenure ends, you receive the invested amount plus compound interest. 

Pros and cons of FD investment
 

FDs are among the popular money investment ideas in India. One reason is that they help investors earn steady interest over a fixed period from a low-risk investment and offer loan options against an FD account. FDs also offer flexible interest rate pay-out options.

On the flip side, the rate of returns is low, while premature withdrawals attract penalties, and the interest earned is taxable.

Factors to consider before investing in fixed deposits 
 

1. Minimum deposits of PSU banks and private sector banks vary. Before opening an FD account, check that out
2. Interest rates can also vary, especially for short-period deposits
3. Check the interest rates for non-cumulative FDs and cumulative FDs, the penalties for premature withdrawals, and the loan facilities 

If you are interested in exploring different investment ideas, you can avail the best rates from IDFC FIRST Bank.

Tips for investing in FDs 
 

While FDs are secure investments, they can lock your money for a relatively longer period of time with penalties levied on premature withdrawals. If you have a big lump sum amount, spread it across multiple deposits. Also, avoid blocking your money in a single account by choosing multiple tenure across deposits.

Investment idea #4: Investing in property 
 

Property investment is investing in real estate for returns through rent, resale or both. One person or a business can own the property.

Pros and cons of property investment
 

Owning a property generates a sense of security. It also generates income. If you have taken a home loan, you get tax breaks, and the property value appreciates. But property selection can be long and exhausting, and getting a new property registered in your name can take time and effort. 

Loans for commercial property get no tax breaks. Instead, you pay tax on all property and bear heavy maintenance.

Factors affecting the value of the property
 

Any of the following issues can impact property value –

1. Economic factors
2. Political factors
3. Demand and supply
4. Location
5. Property size
6. Age and condition
7. Interest rates

Tips for investing in property 
 

To avoid cost overruns, go for ready accommodation. If you prefer under-construction property, check the developer's background and track record, and research the property rates in the area and the city.

Conclusion

If these investment ideas appeal to you, visit IDFC FIRST Bank for a reliable, beneficial, long-term solution for your financial plans.

For instance, if you are interested in investing in gold, you can go for the Sovereign Gold Bonds at IDFC FIRST Bank. This way, you also eliminate making charges, storage costs, and chances of theft. Moreover, the IDFC FIRST Bank 3-in-1 Account opens the door to stock investment with the best FD rates in the industry. 

For steady wealth creation, you can always choose one of the best investment ideas, i.e., a mutual fund. Visit the IDFC FIRST Bank website to get started with your investment journey today!