5 Safe Investments That Can Offer Up to 12% Interest

When it comes to growing your money safely, finding options that offer high returns without taking on undue risk can feel like searching for a unicorn. Yet, in India, several investment avenues—especially with a longer horizon—offer returns of up to 12% while keeping safety in focus. Here are five worth considering:

National Pension System (NPS)

The NPS is a government‑regulated retirement scheme that blends equity, corporate bonds, and government securities to yield average annual returns between 9% and 12%.

Target Maturity Funds (TMFs) / Bharat Bond Funds

These are fixed-income mutual funds that invest in bonds maturing on a specified date. For example, the Bharat Bond Fund (due April 2031) offers approximately 10.9% annualized return.

Secured Non‑Convertible Debentures (NCDs)

Secured NCDs, especially from well‑rated corporates, offer attractive interest rates—commonly 11% to 13% per annum. These are collateral‑backed instruments for added safety.

Recurring Deposits for Women (Post Office / Banks)

Some schemes designed for women and girls offer fixed deposits at around 7.5%. While not 12%, they provide guaranteed returns and strong safety.

Sukanya Samriddhi Yojana (SSY)

A government‑backed scheme for the girl child, SSY provides 8.2% per annum with full tax exemption. It’s one of the safest long-term investments.

Why These Are Safe

– Government or collateral backing
– Predictable returns
– Structured timelines

FAQs

Can I truly get 12% returns safely?

Yes—on average, NPS portfolios with partial equity have historically delivered between 9%–12%.

Are secured NCDs risk‑free?

No instrument is entirely risk‑free, but secured NCDs are safer than unsecured ones due to collateral backing.

What about liquidity?

NPS is locked till retirement, TMFs have moderate liquidity, NCDs are tradable, and SSY has fixed lock-in periods.

Are these tax‑efficient?

SSY is tax‑free, NPS offers deductions, while NCDs and TMFs are taxed based on slab or capital gains.

Should I diversify?

Yes. Diversification balances liquidity, tax impact, and risk for better portfolio management.

Final Thoughts

Safe investment opportunities offering up to 12% returns exist—but often come with conditions like longer lock‑in periods. By selecting schemes like NPS, TMFs, secured NCDs, and SSY, investors can aim for higher yields while ensuring safety.