Investment Plans for Monthly Returns: Generate a Steady Income

Is a Monthly Income Investment Plan Important?

Investment plans with monthly returns can help you with monthly income, capital appreciation, and stability. But are they that important? Do you really need them?

Well, here are some compelling benefits of these investment plans that can help you understand their use and guide you in making an informed choice.

Helps with the Cash Flow

A stable income is important to fulfill your regular needs. An investment plan with monthly returns you have that income even when your regular income ceases to exist because of retirement or more. You may also use it as an additional income for further growth and financial planning.

Diversify Your Investment

As mentioned, monthly income investment plans invest across a variety of assets, including debt or equity securities. This diversifies the portfolio and helps reduce risks. Further, you can carefully research, review, and adjust your funds periodically as per market trends. Additionally, funds can be allocated differently following your risk appetite and financial goals.

Allows You to Grow

By investing in monthly income investment plans, you enjoy the dual advantage: where the fixed income securities help you with stability, the equities make room for capital appreciation and growth.

Flexible Payments

Monthly return plans come with flexibility in payment options. You may choose to receive your returns on a monthly, quarterly, or yearly basis without the worries of switching or reinvesting, helping you to adjust the payment following your requirements.

Tax-saving benefits

These plans and their premiums also qualify for tax-saving benefits under section 80C, 10(10D) of the Income Tax Act, 1961.

Top Investment Plans for Monthly Returns/ Income

Here are some options that you can consider.

Post Office Monthly Income Scheme

These government-backed savings schemes are suitable for individuals preferring stable returns. There are monthly income options, and returns are guaranteed. This means you do not have to worry about market volatility and fluctuations with this scheme.

What do you need to know?

Under MIS, in a single account, you may invest a maximum of ₹9 lakhs, while ₹15 lakhs is the limit for joint accounts.

Senior Citizen Savings Scheme

Another government-backed, long-term scheme, suitable for individuals above 60 years of age or for retirees. The payout option is quarterly, and retirees can use the benefit to build an independent life even after their retirement.

What do you need to know?

A maximum of ₹30 lakhs can be invested in the scheme for five years.

Fixed Deposits

FDs are always considered an ideal way to park surplus cash. However, did you know that they could also offer monthly payout options that provide a steady income stream by paying interest every month. Well-suited for retirees or individuals who have a lump sum amount to invest, FDs can ensure capital safety while offering predictable returns without risking market volatility.

Systematic Withdrawal Plans

Systematic withdrawal plans are investment plans that allow you to make withdrawals every now and then. This withdrawal can be of varying or fixed amounts. Some common examples include mutual funds, ULIPs, etc.

What do you need to know?

The fund withdrawals can be quarterly, yearly, monthly, or half-yearly. The withdrawal frequency can also be changed as per requirements.

Factors to Consider While Buying a Monthly Income Plan

Planning your cash flow? Well, before you do that, consider understanding factors that have an impact on your income. Here are some factors that you should consider while booking a fixed monthly income investment plan for yourself.

Investment Returns

The key to finding the best investment plans for yourself is to assess the performance of different investments and compare them carefully. Understand their returns to have a fair idea about profitability. Now, you may adjust your asset allocation in a way that balances rewards and risks.

Risk Appetite

Understanding your risk appetite is one of the crucial things to do when choosing the best investment plans for yourself. For instance, for individuals looking for safe and reliable investments with guaranteed returns, you may choose fixed deposits, Pradhan Mantri Vaya Vandana Yojana, the Senior Citizen Savings Scheme, and more. The returns are comparatively lower, but so is the risk.

For someone with a high-risk appetite looking for high returns, you may consider exploring options like mutual funds, stocks, etc.

Pro Tip: The “it” strategy is to have a diversified portfolio where you spread your risks effectively.

Flexibility

While choosing the best investment plans for monthly returns, it is also important to understand their flexibility in portfolio adjustment. Better flexibility: you can easily change it based on market trends and changing requirements. Flexibility in changing portfolios helps you boost your returns, tackle emergencies, and make the best out of market trends.

Tax Implications

Don't forget to explore and understand the tax implications of your investment plans while choosing the best one for yourself. Why? Because it has an overall impact on your net returns. Make sure to understand the taxable and non-taxable areas. For instance, the interest earned from corporate deposits or FDs is added to your income and thus is taxable.

Conclusion

From helping you plan your retirement to fulfilling your financial goals and helping you with your monthly budget, monthly returns can prove beneficial in several ways. Further, there are a variety of options to choose from, such as monthly income plans, mutual funds, corporate deposits, FDs, systematic withdrawal plans, Senior Citizen Savings Scheme, and more. You simply need to explore, compare, and then choose a suitable plan. At Jio Insurance Broking, we follow a customer-centric approach, helping you make better and more informed choices.