Retirement planning is one of the main financial goals of any individual. You need to identify your retirement goals and the time period at your disposal to get there. Accordingly, you can determine the size of your retirement corpus.

EPF (Employee Provident Fund) is a popular scheme to build your retirement corpus. Under this scheme, both you and your employer contribute 12% of your basic pay plus DA towards this scheme. 3.67% out of this 12% will be for EPF and the remainder 8.33% will be for EPS (Employee Pension Scheme).

At the statutory retirement age of 58, you can withdraw your EPF along with interest accrued. To enjoy a fun and secure retirement, you must invest your PF funds wisely.

6 Ways to invest your EPF fund smartly

1. Direct Equity

Direct equities have high wealth generation potential. However, you can make substantial gains from stock investments only in the long-run. So, if you can remain invested for a long time and are willing to take some risks, then you can park your PF funds in stocks.

2. Mutual Funds

“Never put all eggs in a basket”. In other words, the best way to minimize your risks is to diversify your investment portfolio. Investing your PF fund in MFs will meet your portfolio diversification needs. You can opt for equity, debt, or hybrid funds. The proportion of funds allocated to each asset class differs with the MF type chosen.

3. Real estate

Real estate is one of the best non-financial investments to invest your PF funds. Either you can reside in the property or earn rental income from it. In some cities, the value of real estate keeps rising. During economic growth also the valuation of real estate will rise.

4. Recurring Deposit

You can set aside a small portion of your PF fund each month and invest in a recurring deposit. Recurring deposits have a minimum lock-in period of 6 months and offer reliable returns at pre-determined rates.

5. Gold ETF

Are you interested in holding the yellow metal? If yes, then you can invest your PF fund in Gold ETFs. They are traded almost at the current market price of gold. They can be traded on the exchanges just like stocks.

6. Fixed Deposits(FDs)

FDs are fixed-income instruments that offer assured returns at a prescribed rate of interest for a certain investment period. FDs are highly recommended for retirees due to their low-risk component.

Bajaj Finance FD offers attractive interest rates of up to 7% p.a. to investors aged below 60. If you book an FD online, you will gain 0.10% more. If you are a senior citizen, you can earn up to 7.25% p.a. - currently, the best senior citizen FD rate in the country.

Bajaj Finance FD has many other benefits too. You can prematurely withdraw your FD to meet contingencies and liquidity needs. You can also avail of the overdraft facility up to 75% of the total FD amount. This way, you can avoid interest losses arising out of premature withdrawals.

Do you wish to hold a combination of short-term and long-term deposits to minimize interest rate risks? If yes, go for the Bajaj Finance multi-deposit scheme. Open multiple deposits with just a single cheque! Moreover, you can choose any tenure between 12-60 months for your deposits.

SDP, another unique offering from Bajaj Finance will help you manage interest rate risks even better. The monthly maturity SDP scheme allows you to invest small amounts monthly at prevailing market interest rates on the date of investment. All monthly deposits have varying maturity dates. The single maturity SDP scheme fixes the same maturity date for all your monthly deposits. So, you can easily build a lump sum corpus with this scheme.

The FD rate calculator on Bajaj Finance website allows you to compute your returns in advance.

With such amazing features, Bajaj Finance FD undoubtedly is the best investment avenue for your PF funds.

Author Bio:

Gaurav Khanna is an experienced financial advisor, digital marketer, and writer who is well known for his ability to predict market trends. Check out his blog at Highlight Story.