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Best Mutual Fund for Senior Citizens in India…!! 

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Best Mutual Fund for Senior Citizens in India

Retirement is the most beautiful phase of anyone’s life. For most, it’s all about memories and having a decent life. It means the end of the earning period for many. But many senior citizens use this opportunity to take the benefits of various schemes to earn additional income. For Senior citizen, making the best use of their retirement corpus that would help keep tax liability at bay and a regular source of income will be better. There are various types of traditional options available to the investor, such as bank fixed deposit, senior citizen saving scheme and Post Office Monthly Income scheme. 

The prime objective of an investment by a senior citizen is capital protection, along with a fixed monthly regular income to manage their daily expenses. Therefore, the investment is characterized as low risk, moderate returns and high liquidity. But there are other options too for an aggressive investor whichhave relatively high risk high return like mutual funds. Ideally a combination of both options should be adopted to deliver regular income and wealth creation for a senior citizen. There are various mutual funds which lie in the above stated category, such as debt, balanced and liquid funds.  

The choice between Debt and Equity Mutual Fund  

 For a senior citizen, 75-80% of the investment in debt scheme and remaining in an equity scheme will be a better option. The main reason behind is that taxation of debt funds makes it a better choice over bank deposit, especially for those in the highest tax bracket. An investor should also prefer dividend plan over a growth plan. It will provide a constant flow of income from the fund in the form of dividends. Equity mutual funds are also a good option to invest in but in a relatively low proportion if the investor is a senior citizen. An investor can invest in equity mutual funds, if the investor has an investment period of more than 3 years, then he/she can take moderate to high amount of risk.  For any senior citizen, a large cap would be suitable as these are less risky compared to other mutual funds and provides return between 12 to 15%. They also beat the normal inflation in the economy. Here’s a look at the list of top mutual funds for the long term duration recommended by Gulaq.com

  • Reliance Income Fund
  • IDFC Bond Fund – Income Plan
  • LIC MF Bond Fund

But every senior citizen must keep in note, that never invest in too many mutual fund schemes to diversify one’s portfolio. Often too many schemes within a category result in over diversify portfolio. It will have a negative impact on your returns.  A maximum of four to five schemes will be enough.  

 

 

*Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.

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