The Buyt Desk
We invest to make return. This is a way in which we grow our money for us. Here are 5 ways to invest your money that will give you assured monthly return.
- Bank Fixed Deposit
Fixed deposits (FDs) with monthly payout are the most popular investment option to get regular income. By investing in this scheme, your investment amount gets locked for a fixed tenure and you’ll earn interest on your investment. You can consider a regular payout on a monthly, yearly, quarterly, or half-yearly basis. Fixed deposit with monthly payout is also called non-cumulative fixed deposits.
Bank FDs have a insurance protection for the deposit up to Rs 5 lakh. This investment option provides mid-high single digital interest rates, allowing investors to invest their money into an extremely secure scheme and get a guaranteed payout each month. You can earn money without the risk of losing your valuable amount due to market fluctuations.
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Post Office Monthly Income Scheme or POMIS
This is a low-risk investment option offered by the Department of Post (DoP), Indian Post. The DOP reviews the interest rate quarterly. The POMIS is perfect for risk-averse investors who need regular income. The interest rates for this scheme are based on the returns provided by the Government Bonds of the same tenure. The Post Office Monthly Income Scheme presently offers a 7.40% interest rate per annum, payable monthly.
Since this scheme is regulated by the Government of India, you’ll receive an interest rate with a negligible scope of credit risk. An individual will get a deposit tenure of 5 years and can start investing with a minimum investment amount of INR 1500. The maximum investment amount is INR 4,50,000 which gets doubled i.e. INR 9,00,000 for joint accounts. You can reinvest the same POMIS investment for another five years once it matures.
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Senior Citizen Saving Scheme or SCSS
This investment option is best for senior citizens. This scheme enjoys sovereign backing thus loaded with complete security assurance. It provides an interest rate of 8.2% per annum from 1st April 2023. You can open an account for this scheme as an individual or as a joint account with your spouse. It comes with five years of tenure and can be obtained at notified post offices and bank branches. If you want, you can extend the period for up to 3 more years.
You can invest INR 15 lakh and enjoy good returns. However, make sure that you subscribe to this scheme within one month after retirement. The interest you will receive from this investment is added to the taxable income and taxed according to your income tax bracket. You can save tax on this scheme as per Section 80C of the Income Tax Act, 1961.
This scheme is available easily. All you need is just fill out an application form at the nearest post office or bank. The application process needs minimum paperwork. KYC generally includes a DOB certificate, PAN card, passport, senior citizen card, etc.
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Annuity Plan
This is another fund investment option for a regular income at a lower risk. Annuity plans are provided by Indian insurance companies for people who need a steady income to enjoy their life without any financial burden. You can use this investment option as a retirement plan by investing in a lump sum to get payments at regular intervals.
The investment made is further invested by the Indian insurance companies and the investor is paid with the produced returns. Investing in annuity plans requires several fees like surrender charges and commissions. Also, it doesn’t offer any tax benefits and is taxable.
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Government Long-Term Bonds or Govt Securities
Government bonds or securities also called G-Secs are great low-risk investment plans for risk-averse investors. The main purpose of the government behind this bond is to increase the capital for government expenditure and the country’s economic needs. Long-term government bonds are basically the debt instrument issued by the State or Central Government. These are issued under the RBI (Reserve Bank of India) supervision.
These types of bonds generally range from 5-40 years and come with a predefined maturity date. By investing in these bonds, you will get regular interest rates or coupon payments as agreed by the Indian government. The interest rate on G-Secs bonds is known as the coupon rate or yield. According to RBI, the interest added must be paid to the investors every six months.
