How can the Defence personnel make investments effectively? What are the right investment plans for the Defence personnel? What to keep in mind while investing in mutual funds? How can the Defence personnel avoid making mistakes while investing? Zee Business expert Rahul Saini, founder and president of Mission Financial Literacy has some useful money-making tips for them:

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Saini says that merely putting money in savings accounts will not yield desired results as the interest rates in the savings account will give smaller returns. Usually, a bank savings account gives returns of around 4%. This amount is not even sufficient to beat inflation, which is constantly eroding our money's worth, he says. If inflation rises by say 6% the returns from bank savings account will be negative 2%.

Saini says that if Defence personnel invest in mutual funds chances for high returns multiply. He said that investments in mutual funds can give high returns which can beat inflation easily. The best time to invest in the markets is when the markets are falling. He reasons that in a falling market the valuations of stocks are low.

He further said that investments in fixed deposits give you around 8% returns. That could be helpful in beating inflation but if the Defence personnel want higher returns, mutual funds are a good option.

He said that though investments in insurance is very important, its purpose is primarily to give you security from unforeseen happenings. They are not likely to give you an income boost.

For a soldier, the importance of the right investments is huge as their lives are always at stake. Moreover, their work span is also relatively shorter than the usual service period.

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Saini's top tip to the Defence personnel is that they should not only focus on saving money but also earning through multiple sources. It is important for them to see by how much is their income growth and they need to check this often.