A short-term investment can be an ideal investment option if it provides considerable returns even when the investment period is not long. They are specifically created to provide relief to the investor during an emergency or financial crisis. Before investing in a short-term investment avenue, you must check whether it provides enough returns and liquidity options along with access to some modern and user-friendly features. Here are some of the best short term investment options that can assist your finances in 2021:

Recurring Deposits 

Recurring deposits are preferred by those who want to grow a fixed amount every month so that the interest accrued monthly deposits contribute toward their aim of collecting a bigger corpus in the future. Though it inculcates the discipline of saving regularly, it might not help you generate a huge corpus quickly. 

Liquid funds 

You may prefer to invest in liquid funds as they provide a good return rate of up to 7% and are among the less risky types of mutual funds. The tenor of liquid funds is usually less than a year and you can withdraw your deposits anytime once the minimum investment period of 91 days is completed. 

However, as the returns are not fixed and influenced by market forces, you might have to think twice before investing in liquid funds. 

Systematic Deposit Plan 

Bajaj Finance has introduced SDP i.e. Systematic Deposit Plan in the investment market in order to provide an efficient, convenient, and profitable option for those who are keen on investing in short-term investments. As per this plan, you need to deposit at least Rs. 5000 every month and then you can choose the number of deposits to be from 6 to 48 depending upon your convenience and investment requirements. 

The tenor for each deposit can range up to 60 months or you can adjust the tenor in such a way that you can withdraw all of your deposits at once. The first option lets you withdraw maturity proceeds one after the other sequentially as it locks in each deposit for the same period. 

It is an ideal short-term investment plan for those who are not sure about investing a lump sum amount. 

Fixed Deposits 

Fixed deposits can be used for both short and long-term investment plans as they usually offer a wide tenor range. Some corporate FDs like Bajaj Finance FD offer a flexible tenor from 12 to 60 months and this enables you to use it for meeting your short-term financial goals. 

The option of investing in several FDs with a single payment cheque allowing you to create a series of maturity amounts is offered by Bajaj Finance FD. This lets you manage your short-term fund needs and you may even invest in FDs of both shorter and longer tenors simultaneously. 

A higher FD interest rate of up to 6.75% ensures that your deposits earn well even during a short investment period. Moreover, it is a safe investment avenue as CRISIL and ICRA which are the most trusted credit rating agencies in India have given it a high credit rating. Suppose that you want to invest Rs. 25,00,000 in the Bajaj Finance Fixed Deposit. Some of the shorter tenor options that you can exercise and the FD returns associated with them are displayed in the below table:

FD plan	Principal Amount	Tenor	Rate of Interest	Interest gains	Maturity amount
Bajaj Finance FD	Rs. 25,00,000	12 months	6.4%	Rs. 1,60,000	Rs. 26,60,000
Bajaj Finance FD	Rs. 25,00,000	20 months	6.4%	Rs. 2,72,316	Rs. 27,72,316
Bajaj Finance FD	Rs. 25,00,000	25 months	6.85%	Rs. 3,70,033	Rs. 28,70,033

Therefore, you can see that Bajaj Finance FD offers good returns even for the shorter tenors. 

You also have the option of investing in non-cumulative FDs to earn a regular income through periodic interest payouts. The periodic interest payouts can be used to fulfil your short-term investment objectives or they can also be used to clear your electricity bill, utility bills, and other regular expenses. For confirming the tenor and FD type that can suit your short-term investment goals, you can use the FD calculator India that is present on its official portal.

There are several short-term investment options in India but you must only choose the one that provides maximum returns in a short period. Also, you must consider the factors like investment options, the flexibility of tenor, safety of investments, etc. before investing. Liquid funds, recurring deposits, debt funds, etc. can be used for achieving short-term financial goals but they might not provide the flexibility and easy investment options that SDP and Bajaj Finance FD offer. Also, these investment options offered by Bajaj Finance are safe as they have received the highest credit ratings from CRISIL and ICRA. Also, the interest rates they provide are high enough to help you earn substantial returns at maturity.

Short-term investment options are the ones that will help you to achieve your short-term financial goals. However, it is not easy to pick the instrument that can help you meet your short-term needs as there are many options available in the market. You can invest in RDs, POTDs, or Liquid Debt Funds as all of them are designed to help you attain your short-term financial objectives.

However, if you want to invest in an instrument that provides sufficient returns and convenience of choosing a flexible tenor then you can invest in fixed deposit plans from Bajaj Finance. The high FD interest rate, flexible tenor ranging from 12 to 60 months, multi-deposit facility, and easy investment options makes it one of the best instruments in 2021.