What are the Best Investment Plans for Monthly Income?

April 29, 2021

Although retirement should not be the only reason you should invest a second income is always a great idea so if you have considerable disposable income start investing in schemes that payout profits and dividends.

Listed below are 5 best investment plans for a monthly income that you should consider to consider in India:

1. Post Office Monthly Income Scheme:

   POMIS is an excellent option of investment offered by India Post if you are looking for a constant income. The deposit tenure is 5 years and offers a 7.6% rate of interest. You can start investing with a minimum amount of Rs 100 and a maximum amount of Rs 4.5 Lakh however with a joint account you can invest up to 9 lakh. It is low risk and safe investment that guarantees a monthly income.

2. Government Bonds:

   The objective of issuing government bonds is to raise capital for government expenses. They are long term, low-risk investments that pay interest either monthly, quarterly, half-yearly or yearly depending on the option available. The investment in these bonds range between 15 to 20 years and comes with a predefined maturity date. Since they are traded in the secondary market, they can be sold off anytime. 

3. Corporate Deposits:

   Corporate deposits are very similar to a bank deposit except that you invest with a corporate entity like non-banking financial companies (NBFCs) and housing finance companies (HFCs) who offer corporate deposits at a high-interest rate and flexibility that a bank would not offer however they are not as secure as the bank, you need to check their credibility before investing.

4. Monthly Income Plan:

   MIPs are mutual fund plans. It is suitable for those who are willing to take moderate risk. Its investment tenure ranges between 3 to 5 year with returns between 6-9%. These funds payout their investors every month but this is not fixed and is based on the performance of the fund. There is a possibility of negative returns too since the returns are not guaranteed. 

5. Senior Citizen Savings Scheme:

   SCSS is a monthly investment plan for senior citizens only who must subscribe within one month after retiring. This scheme is available at notified banks and post offices. It is a low risk, high return plan with a minimum investment of Rs 1,000 and a maximum of Rs 15 Lakh. The maturity tenure is 5 years which can be extended to another 3 years. It offers an interest rate of 8.6% per annum which is paid out on the 1st working day of January, April, July, and October.

Conclusion:

Always plan your investment in 2-3 investment plans that meet your financial goals and a stable income every month.

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