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The search for the best investment plan in India has gone a notch higher. The middle class forms an important cog in the Indian economy.

Moreover, it will outnumber the middle class in China and the US by 2025 as per studies.

Also, the private consumption in India is 60% of the GDP, boosted by the middle class.

Thus, it is evident that the middle class can sustain India's growth and their investments will play a huge role in achieving this goal.

We hereby discuss the various investment options for middle-class investors in India in this article. Let's begin!

Need For Best Investment Plan in India

The best investment plan consists not only of meeting one's needs but also builds wealth over time. We have all heard it many times, haven't we?

The real problem lies in its execution.

Buying mutual funds, bonds, stocks is simply not enough. It thus needs good planning as well.

Indeed having an investment plan and following it is important.

I am going to share an investment template in this blog to make it easier for the readers.

Any person (middle class like me) can use this flowchart, whose wish is to invest in a clear plan.

You must be wondering, "Why follow this investment plan?".

Well, for the simple reason that it correlates between your income, needs, and investment decisions.

Best investment plan

This infographic can thus help one to prepare their own investment plans.

It helps make sense between your income, goals, and investment choices.

What the above infographic does is really simple,

1. Savings: Right before you start to invest, it is thus important to save.

Your savings will fund all your investment needs. There are various methods to optimally save your income.

2. Objective: Hailing from a middle-class background, it is thus important for the investor to have a clear objective regarding their investment.

An aimless investing will lead you nowhere.

I have suggested two objectives in the infographic,

i)Wealth creation ii)Need-based investing.

i) Wealth Creation: When the objective of the investment is wealth creation, the time horizon is thus limitless.

What is 'limitless horizon' here?

It simply means, Keep buying(no selling) the optimal investments each month and watch your wealth grow with the passage of time.

ii) Need-based investing: At this point, we identify our other needs like home buying, children's education, foreign vacation, etc.

Moreover, there will be two kinds of needs you will be seeing here,

i) short-term needs and ii)long-term needs.

Let's understand each of them in detail.

1. Investment Plan for Wealth Creation

What do we mean by wealth creation?

It thus refers to becoming financially rich.

We can do this by adding more and more assets over a period of time.

Withdrawing money is not permitted.

We, from middle-class backgrounds, often confuse ourselves with this important financial goal.

The result? We ignore it.

So where do we confuse here?

By believing that wealth creation and need-based investing are the same things.

Wealth creation thus has to be a separate goal. Mixing it with need-based investments is wrong.

When we mix our life's needs in this process, it consequently lessens our willingness to build wealth.

So, keep them separate.

Do our needs really eat up our wealth? Yes, it does. Needs are endless.

Furthermore, wealth creation takes time. It is a slow process. The rate at which wealth appreciates can really dry your motivations.

So no matter how slow the speed of wealth creation in starting years may look, keep funding your corpus.

You may refer to the following table to get an idea of how long does it take a middle-class person to build wealth,

Wealth to buildRs. 2.0 Crore
Starting investment (SIP)Rs. 5,000 per month
Annual Increment to SIP10%
Average Investment Return15% p.a.
Time required to build Rs. 2.0 Crore 22+ years

You may be wondering, "what is the point?".

Well, the point here is, it will anyways take a good amount of time to build wealth.

If you will also begin taking out money from your corpus during the initial days, wealth creation will become difficult.

How to go about this?

Separate the two at the very beginning,

1. Investment to build wealth.

2. Investment to deal with our needs.

Moreover, once, this clarity is there, the next step is to find the right investment opportunities.

best investment plan

What Are The Best Investment Options For a Middle-Class Person?

The following options will help you decide the best investment plan in India for your purpose,

1. Index Funds: As mentioned in the flowchart, this has to be 50%.

Equity-based investments are subsequently well suited for those investment plans, whose horizon is more than 20 years.

The reason being, equity gives great returns for investments of such period. However, it is important to diversify your investments.

2. Mid-cap Funds: This has to be allotted 35%.

The investment outlook should be thus long enough to reap the benefits of this fund.

Slightly risky but consequently well suited for such time periods.

You can thus opt for a SIP in a decent mid-cap fund and let it pay you back.

3. Direct Stock investing: Indeed, highly risky. But the risks can be thus managed by investing in stocks that are undervalued.

Note: The investment horizon suggested in the flowchart is 'forever'. However, if you are not comfortable with this word, I would suggest you a minimum duration of 25 years.

2. Invest Plan for Various Needs of Life

Wealth creation is okay but it is equally important to diversify the investments to meet the various needs of life.

There are thus some non-negotiable demands in one's life. If we do not address them today, they will become a big problem in the future. Be it,

i) Own Home

ii) Children's education

iii) Retirement corpus

Moreover, there can also be some needs that may appear like a 'necessity', but in reality, they are nothing but your psychological tendencies or societal pressure.

Such as,

i) Fancy car

ii) Luxurious vacation

iii) Extravagant parties

Thus, it is important to make your list of needs. Once done, subsequebtly get on to making a plan. (Anything you feel you might need 6 months in advance, will be added to the list).

Divide the needs into 2 parts

i) Short-term (<3 years) ii) Long-term (>3 years)


Short-term needs

Bank DepositsDebt Based Mutual Funds
I would personally suggest 50% of your short-term needs to be managed through this.These funds invest in bond and fixed income securities.
As soon as you figure out your short term needs, begin a recurring deposit for the same. Best way to manage such needs.In case, you need an even higher return, go for SIP in debt funds.


Long-term needs

Multi Cap Funds(35%)Balanced mutual funds(65%)
Best suited for a horizon of >5 years.These are equity based in nature. Also, contain a portion of debt funds.
Generates a return of 15% to 18% p.a.Equity to debt can be in the ratio of 70:30. Debt funds lower the riskiness.


We began this article by posing a question, "Which is the best investment plan in India for the Middle-class?". Our answer has been divided into 3 parts.

1. Following a blueprint to achieve your financial goals is a must. I have provided one for you (see flowchart above). It will thus help you to stay on course and choose the best way forward to your goals.

2. We came across the confusion among individuals from the middle class regarding wealth creation and need-based investing. Thus, it is important to stay invested for a longer time to build wealth, while need-based investing can either be short-term or long-term.

3. Finally, we discussed the various investment plans for the middle class. It cannot be based on the 'returns'. The available time will subsequently be the basis of selection.

It is thus my profound hope that the discussion above, will help you crystallize your thoughts and give you a path to begin your investment journey. Happy investing!

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