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6 Best Investment Plan for 3 Year with High Returns

Short-term investments are created to give good returns in a short span of time which can be a year or even a few months. These plans are more focused to satisfy the expected near future expenses. Usually, investors who are more willing towards short-term investment plans aren’t really interested in waiting for years to get their money multiplied many times over. Instead, they look for quick and effective results. This is where short-term investment options come to their rescue. Most people generally invest to obtain high returns and with the minimum risk involved. To accomplish this purpose, most of the investors seek proper investment planning which not only achieves the desired results but also keeps a tab on the risk profile of the investor.

Those who want to make the most of their invested money in a short span of time should go for short-term investment plans. The entire concept of short-term investment is to offer decent returns within a short span of time that is within a year of 3 years.

Investment Plan for 3 Year

6 Best Investment Plan for 3 Year

For getting higher returns on their savings, there’s a list of the best investment options for you to make your wealth grows.

  1. Saving Account
  2. Liquid Funds
  3. Short-Term & Ultra Short-Term Funds
  4. Equity Linked Saving Schemes (ELSS)
  5. Fixed Maturity plans
  6. Treasury Bills

Let’s discuss these plans below.

Savings Accounts

Recently, the falling repo rate regime has brought the savings account interest rates to an average of However, leaving your money in a savings account ensures no decline in your principal amount, as there is no elect of market fluctuations on your savings.

Benefits of Saving Account

The benefits of investing in a Saving Account are listed as under:

  • Liquidity
  • Safety of funds
  • Additional earnings because of auto sweep facility
  • Automatic debits for payments
  • Auto credits for investment incomes
  • Convenient fund transfers
  • Joint accounts
  • Nominal interest rates

Liquid Funds

Liquid funds are types of debt mutual funds that are extremely open-ended income schemes that invest in short-term fixed interest generating money market instruments. By investing in liquid funds, you benefit from high liquidity with easy access to your money, along with attractive returns. However, it is best to store only a part of your surplus money in liquid funds, as there are several tax implications.

Benefits of Liquid Funds

The benefits of investing in Liquid Funds are listed as under:

  • Fixed Returns
  • High Liquidity
  • No Exit Load
  • Low Risk
  • Higher Returns than Savings Account/Fixed Deposits

Short-Term and Ultra-Short-Term Funds

These are also debt mutual funds with a higher maturity period, and their span ranges between 90 days to 3 years. Due to comparatively longer tenors, these lands protect the investments against reductions in interest rates As a result, they are more stable as they charge an exit load. Returns on short-term debt funds are good for those falling in a higher tax slab as opposed to bank fixed deposits. But, both short-term and funds are affected by market volatility, unlike fixed deposits.

Benefits of Short-Term & Ultra Short-Term Funds

The benefits of investing in Short-Term & Ultra Short-Term Funds are listed as under:

  • Short-Term & Ultra Short-Term Funds are good to part your short-term monies but not exactly liquid
  • A very low total expense ratio (TER) is a major advantage of Short-Term & Ultra Short-Term Funds

Equity Linked Saving Schemes (ELSS)

Equity Linked saving schemes are tax-free funds with more than investment inequities. they have a lock-in of 3 years to allow the land to grow as no redemptions are allowed These convert into open-ended funds alter 3 years which means you can trade them and redeem them for use. 

Benefits of Equity Linked Saving Schemes (ELSS)

The benefits of investing in Equity Linked Saving Schemes (ELSS) are listed as under: 

  • Shortest lock-in
  • Potentially higher returns
  • Better post-tax returns
  • Regular investing is hassle-free and convenient

Fixed Maturity Plans (FMPS)

These are also close-ended debt mutual funds with a maturity period that stretching up to 5 years. Fixed maturity plans invest in debt or money markets that have the same maturity period as the plan itself. If the FMPs tenor is 3 years, it implies that it will invest your money in those debt instruments that expire at the 3-year mark. FMPs are most asked after at the end of the financial year as they give greater tax advantages But, FMPs have their disadvantages too – especially in terms of less liquidity.

Benefits of Fixed Maturity plans

The benefits of investing in Fixed Maturity plans are listed as under: 

  • Lower risk
  • Stability

Treasury Bills

Government can increase money by issuing Government Bonds or Treasury Bills, where treasury bills are for a shorter tenor and government bonds are for a longer period. Treasury bills are for a shorter tenor, and Government bonds are for a longer period of 510 years. These bills have growth periods of 91 days, 182 days, and 364 days. They give good returns too. The only disadvantage is that you have to invest in multiples of Rs. 25,000 to buy them from the government.

Benefits of Treasury Bills

The benefits of investing in Treasury Bills are listed as under: 

  • Risk-free
  • Liquidity
  • Non-competitive bidding

Benefits of Investment Plan for 3 year 

The benefits of investing in 3 Year Investment Plans are listed as under:

  • Wealth Creation
  • Financial Protection
  • Death Risk Coverage 
  • Retirement Savings
  • Flexibility
  • Save Taxes 
  • Loan Facilitator


Investment plans assist you to grow money to meet your future events. They help you save and also invest systematically. But you need to be careful while choosing the best plans. Ideally, your choice of the plan should meet your investment purposes, the tenure, and also your understanding of risk. 

Frequently Asked Question:

Q1. What are cash and short-term investments?
Ans. Short-term investment and cash are the additions of two balance sheet line items. Both are considered liquid assets.

Q2. What is a short-term debt fund?
Ans. Short term debt funds are also known as income fund in mutual fund scheme that has a maturity period of fewer than 3 years. These funds mostly invest in debt instruments like corporate bonds, government securities, etc., and are best suitable for individuals who want to fulfill their short-term investment goals.

Q3. What are the benefits of investing in short-term investment?
Ans. Some benefits of short term investment are:

  • The short duration of time
  • High flexibility
  • High liquidity
  • Transparency


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