Investment in any asset is always considered good for a safe and secure future. Right from the small age, our parents have taught us about the importance of saving and investment for a better and joyful future life. Be it mutual funds, fixed deposits, PPF or real estate, today there are different genres of asset class available in the market for investment. However, when it comes to higher returns, most of the individual opt for investing in equity or real estate market. Both are an attractive investment option with their own sets of benefits.
But, often many get confused in choosing the right option when it comes to investment. So, read this blog and clear the basic understanding of both to decide which one is better for you:
An equity investment refers to investment in stocks or equity products of listed and unlisted companies. Investing in any share, stock or mutual fund like index funds, sectoral funds, diversified funds, etc. offers benefits like non-tracking of the market regularly. Also, you can choose to invest as per your investment potential may be smaller or bigger.
However, in the case of equity investment, returns are neither fixed nor assured. On the other hand, they are completely dependent on a company’s market performance. Due to this, investment in this asset class comes with a risk. So decide accordingly.
Real Estate Investment
With the implementation of stricter reforms like RERA, investment in the real estate market has become quite lucrative these days. You can get a higher appreciation and better returns. Investing in multiple properties can also secure your future and your post-retirement period. For instance, you can earn additional income by renting your residential flat or converting it into a PG or rental home.
Also, real estate investment offers tax benefits and exemption while availing home loan or loan against property or renovation loan, etc.
But then just like equity, investing in the property market also comes with some disadvantages like financial crunch in the market, lower liquidity, etc. At the same time, an investor has to pay maintenance cost for the property too.
Which is better for Investment?
With high returns benefits, an individual can invest and build their portfolio either in Equity or real estate. However, among the two investing in real estate has an edge over the equity. A maintained property means more security for an individual as well as the family members. With the launch of REITS, even a small investor with better financial potential can now invest in the commercial market and earn a better return along with capital appreciation.
However, always remember don’t follow any set pattern or what others are following in the investment market. Do your research and decide on yourself what will be better for you and your family and in which investment option you are comfortable. After all, the final decision is yours!