Best investment options for working women in their 30s

Public Provident Fund (PPF) is probably one of the best retirement investment schemes, offering complete tax-free benefits as well as a steady interest income. It is an ideal risk-free option where you can deposit up to Rs 1.5 lakh a year and earn an interest rate of 8% currently. The interest keeps compounding annually and credited at the end of every years. While it does not offer quick returns, it does provide long-term stability and decent returns after a span of 15 years. You can extend the tenure further in blocks of five years after the initial lock-in period.

Another tax-efficient long-term investment option is the National Pension Scheme (NPS), a concoction of equity, fixed deposits, corporate bonds, liquid funds and government bonds. It offers completely tax-free benefits under section 80C of the Income Tax Act to the tune of Rs 1.5 lakh, plus you can claim an additional tax-free deduction up to Rs 50,000 under Section CCD (1B). Moreover, under NPS, you have the option to invest in equities depending on your risk appetite. The one year market return for Fund option E is around 9.5%, while the same for 5 years is 11%.

Buying mutual funds through the systematic investment plan (SIP) route has long been a favourite with investors, again for long-term investment. And equity-linked investment schemes (ELSS), a diversified equity mutual fund product that allows tax-saving under Section 80C of the Income Tax Act, are one of the most ideal investment options for young working professionals. In the past five years, the average return from the top 10 ELSS stands at almost 20% so even the introduction of 10% long-term capital gains (LTCG) tax on equity earnings does not dent its appeal.

If you have the appetite for higher risk and are willing to put in extensive research, you can also consider investing in stocks. However, keep in mind that 2019 is election year. "As the first half is going to be highly volatile, investors should focus on sectors that have a high defensive component, and better earning capability such as consumer goods, auto, banks or IT," according to Gautam Duggad, Head-research, Motilal Oswal Securities.

One of the biggest mistakes made by thirtysomethings with dependents is not buying life insurance, and working women in this demographic are probably guiltier than most others. "In its simplest form, life insurance means protection against risks in life. These risks also exist in a woman's life, sometime even more than a man's life," said Souvik Jash, Appointed Actuary of Aegon Life Insurance Company Limited. Yet, data from Insurance Regulatory and Development Authority of India (Irdai) show that only 90 lakh women bought life insurance policy in 2017-18 while 1.91 crore policies were purchased by men in the same period. No, it's not enough to have your spouse invest in a retirement policy. Just one life insurance policy between a couple means that you have to be prepared for a transition from a double income family to a single income one down the line. Investing in adequate life cover is also crucial for single women with dependent parents for the same reason.

Studies show that women not only live longer than men but also utilize more medical services due to a greater likelihood of chronic disease and disability apart from reproductive care. Hence there is a strong case for working women to take a separate health insurance policy, instead of settling for coverage as a dependent in a family health plan. Furthermore, there is the maternity benefit to look forward to. Expenses for a normal delivery alone cost anywhere between Rs 15,000 and Rs 1.5 lakh, without accounting for unexpected occurrences that may need urgent medical intervention and, hence, further expenditure. Without a health policy in place, such out-of-pocket expenses can do a number on a family's budget.

Apart from PPF, debt covers options such as bank fixed deposits, small saving schemes, bonds and debt mutual funds. While it's certainly not a good idea to binge on such low risk, low returns options, an ideal asset portfolio will make place for them to ensure assured income at fixed intervals.

Also, to prepare for unforeseen events, the first thing you should do is set up a contingency fund, a corpus that can take care of three to six months' of expenses. You can put this money in a liquid fund as it gives better returns than money in a savings bank account.

Proper asset allocation is key to all kinds of financial empowerment. Even the highest-returns generating assets like equity funds can be of no use unless you do prudent asset allocation. Here's an easy way to figure out an age-appropriate asset allocation mix: Your allocation to debt funds must be equal to your age. Put another way, to find out what proportion of your investment needs to be in equities, just subtract your current age from 100.