The Truth About “Guaranteed Returns” – What New Investors Must Know

By Admin

• 25 Oct, 2025

💡 The Truth About “Guaranteed Returns” – What New Investors Must Know

When you start your investment journey, the word “guaranteed returns” sounds comforting — it feels safe, stable, and secure. But in reality, this term can often be misleading and misunderstood.

Let’s break down the truth behind so-called guaranteed returns and what every new investor must know before trusting them.

⚠️ 1️⃣ The Myth of “Guaranteed” Returns

In the world of investments, there’s no such thing as zero risk.

• If someone promises guaranteed high returns, it’s a red flag 🚩.

• Legitimate investments always carry some level of market, credit, or inflation risk.

• “Guarantee” only applies to certain low-risk, fixed-income products — and even they have limits.

🏦 2️⃣ Where Returns Can Be Guaranteed

Some traditional options do provide predictable returns — though often at the cost of lower growth potential:

• Fixed Deposits (FDs): Stable, but returns may not beat inflation.

• PPF (Public Provident Fund): Government-backed, long lock-in, tax-free returns.

• EPF/VPF: For salaried individuals, offering safety and steady growth.

• Insurance-Linked Savings Plans: Offer declared bonuses, but low liquidity and returns (~4–6%).

🧮 Tip: Guaranteed ≠ High returns. It just means predictable, not profitable.

📉 3️⃣ The Real Cost of Playing It “Safe”

If your money grows at 5–6% and inflation is 6–7%, your real return is zero or negative.
That means your purchasing power decreases over time.

While safety matters, relying only on guaranteed products can erode long-term wealth.

💹 4️⃣ Smarter Alternatives for Growing Wealth

To truly build wealth, investors must balance safety with growth potential:

• Mutual Funds (Equity & Hybrid): Long-term growth, SIPs reduce risk through averaging.

• NPS (National Pension System): Market-linked returns with tax benefits.

• Debt Funds: Moderate risk, better liquidity than FDs.

• Index Funds/ETFs: Track the market, ideal for long-term investors.

Balance is key — a mix of stable + growth-oriented assets gives better results than chasing “guarantees.”

🧠 5️⃣ How to Protect Yourself

✅ Always read the fine print — “guaranteed” may refer to returns subject to conditions.
✅ Avoid schemes promising unrealistic profits.
✅ Prefer regulated instruments (RBI, SEBI, IRDAI-approved).
✅ Diversify — don’t keep all money in one type of product.

✅ Final Thoughts

“Guaranteed returns” sound attractive, but true financial success comes from knowledge, discipline, and patience — not promises.

Invest smart, stay informed, and remember:

“The only guarantee in investing is that time and consistency reward the wise.” 💰

📧 Email: contacts@proshieldinvest.in
📞 Phone: 011-69290568
🌐 Website: www.proshieldinvest.in