Want to make Risk Free Investments? Read about these 4 Safest Investment Options in UAE.

By Sakshi Srivastava - 23 May 2022 Last Updated: 04 Jul 2022
Want to make Risk Free Investments? Read about these 4 Safest Investment Options in UAE.

Investing your money is probably one of the most effective ways to increase it while it is dormant. Isn't that impressive? However, investing is not something that can be done on the spur of the moment. It necessitates a solid understanding of both the product and the market you intend to join and needs to be a Safe Investment as well. 

Whether you're an Emirati or an expat, learning how to safely invest money in the UAE is an essential first step toward financial freedom. However, choosing the ideal investing strategy in this country might be a difficult task that few people can overcome without much research.

The trouble doesn't stop there; you'll need to know your risk tolerance, investing capacities, timetables, and so on. Thus in today’s blog, Dhanguard will guide you on how to make safe investments in the UAE. So without any further ado let’s learn!

Should You Invest in the UAE?

Pick up the threads to make progress in deciding whether or not to invest in the UAE. Also, in the general index report of the World Happiness Report in 2020, the UAE rated first among all gulf countries and the Arab region. Also, with the value of property and real estate skyrocketing, the UAE is becoming one of the finest areas to invest in. Furthermore, the UAE offers far greater value for money, as a million dirham may buy you twice as much as it would in New York or Mumbai. Given the fact that UAE nationals can now own property, investing in the UAE makes more sense than ever.

Below mentioned are even more reasons as to why you should choose UAE for making Investments-

Tax Free Earning Environment

The tax free earning environment is at the heart of the UAE market, attracting many people to the UAE. This is mostly due to the fact that most countries throughout the world charge exorbitant taxes on income and investment profits, but not in the UAE.

Market that is Dynamic

Even when the rest of the world appears to be at a halt, the UAE market is dynamic, always growing and flourishing. As an example, during the current epidemic, when most markets dropped and fell to all-time lows, the UAE managed to hold its footing.

High Profits 

The United Arab Emirates has been rapidly developing. UAE is on its way to become one of the most well-known names among developing countries, with a thriving tourist business and steadily increasing real estate values. Dubai, for example, is on its way to becoming a "new world city."

Safe Money Investment Options in the United Arab Emirates

The Safe Investment Options to put your money into in the United Arab Emirates are mentioned below-

Fixed Deposits

Fixed deposits are short-term, low-risk investment alternatives given by banks and are considered one of the safest investment options available in the market. You place your funds in a fixed deposit account. The monies are secured for a predetermined period. When the deposit matures, you can withdraw your funds along with the profit gained. Fixed deposit accounts' profit or interest rate is predetermined, so you may calculate your return right away and know how much profit you'll get after a particular number of years.

What to keep in mind-

  • Fixed deposits are one of the most secure investment solutions currently accessible. Fortunately, refunds are guaranteed, and you will not lose your money.

  • Fixed deposits, of course, do not give a high return rate due to the fact that they are risk-free. The maximum profit rate offered by most fixed deposits is between 1% and 2%.

  • Because of the unusually low interest rate, you will not be able to build a corpus that can potentially outperform inflation over time.

Annuity Investment Plans

Annuity plans are long-term investment vehicles in which you either make a one-time lump sum investment or pay a monthly or annual premium. After that, the money invested is locked in for a set length of time. When your annuity plan matures, you will begin receiving a regular payment from the provider as income. The compensation can also be received as a lump sum payment. Keep in mind that annuity plans are solely investment plans and do not offer any life insurance advantages such as endowment or child investment plans.

What to keep in mind-

  • Make sure you thoroughly review the details of your annuity plans. Many annuity plans do not provide sufficient returns to establish a corpus large enough to outperform inflation. As a result, always purchase Annuity Investment Plans after consulting an expert or performing extensive study on your own.

  • You have no influence over the investments you make into annuity plans. Furthermore, the insurance firm has complete discretion over how and where the money is invested.

Endowment Investment Plans

They are a sort of life insurance policy that guarantees that even if the policy holder survives the term of the policy, they will receive a lump-sum payment. As a result, endowment plans can be thought of as insurance for your life insurance policies. Generic term life insurance plans, for example, only payout if the insured individual dies during the policy's term. Endowment plans, on the other hand, split your premium into two parts: one for building a corpus and the other for paying term life insurance benefits. When the plan reaches maturity, the corpus that you have built during the plan's lifetime is distributed. Furthermore, endowment plans ensure that your and your family's future is secure no matter what happens.

What to keep in mind-

  • Endowment plans have lower returns than other investment options because they are low risk investments. Endowment plans, on the other hand, are an excellent option if you can't afford to take even a small risk with your money.

  • Endowment plans almost always provide a positive return.

  • Even with the possibility of receiving a lump-sum payment upon plan maturity, the liquidity of funds still remains. 

REIT (Real Estate Investment Trusts)

You can invest in REITs to get some of the benefits of the UAE real estate market without the risks of buying homes (real estate investment trusts). REITs are equities in firms that buy real estate properties (Equity REITs) or provide mortgages to real estate investors (Mortgage REITs)  REITs can be purchased and sold just like any other stock. Rather than purchasing and managing properties, investors hold the stock of corporations that invest in the market (including mortgage lenders). REITs make money by paying dividends and increasing the value of the REIT. They frequently pay regular dividends (in fact, dividends account for the majority of their income), providing investors with a reliable stream of income.

What to keep in mind-

  • REITs are an excellent way to invest money in the UAE and obtain exposure to real estate without taking on the dangers of owning a home.

  • Buying REITs as ETFs is the best method to acquire them. Individual REIT investments have the same risks as individual stocks.

  • There are REIT ETFs that add to the diversification of your portfolio, just as there are equities and bond ETFs.

Conclusion

Making safe investments and taking calculated risks will definitely prove to be fruitful for you in the long run. The above-mentioned list of investment options curated by our Experts at Dhanguard will keep your hard-earned money safe and your desire of remaining financially sound for the rest of your life will surely be fulfilled. 

Thus we hope this blog provided you with insightful information. For more information on other related aspects, feel free to check out our website as well or get in touch with our experts by visiting our Branch Office.

Investments is made simple and hassle-free with Dhanguard in Dubai, UAE. We provide you various investment options like Index Fund, Gold, Mutual Fund, Stocks, SIPs, Bonds, Fixed Deposite, Sukuks with the minimum possible trouble including paperwork & payments.

By Sakshi Srivastava

23-May, 2022

Investments Related FAQ

Frequently Asked Questions

  • Why should one Invest?

    Earning money now is insufficient, since it may not be enough to meet life's financial objectives. As a result, it is critical to spend money. Saving money in the bank is the same as giving up an opportunity to make money. It is crucial to invest carefully in the different plans available on the market, choosing the one that is ideally tailored to your objectives.

  • What is the eligibility to buy Investment Plans?

    With new technologies and goods, the investment market is rising by the day. The conditions for investing in different forms of investment instruments differ depending on the providers in the UAE.

  • What are the best Investment for Expats in UAE?

    Expats can invest in stocks, bonds, real estate, cash, UAE mutual funds, or other forms of funds in the UAE.

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