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How to earn monthly return from mutual funds

I am Srikrishna from Hyderabad. I am planning to invest 30 lakhs for my parents retirement with a monthly income of 25,000 for the next 15 years. Please suggest?

Apr 21, 2017 by Srikrishna Sajja,   |   Mutual Fund

Since this investment is for getting regular return from retirement amount, have you figured out how much risk your parents can take? If they do not want to take any risk, then investing in Senior Citizen’s Scheme, Post office MIS, good rated corporate fixed deposits and bank deposits are the only option.

However, if you invest in mutual funds, then there is risk. However, the risk level will depend on the category of funds that you choose to invest. For earning regular return while taking some risk, MIPs and Balanced Fund can be a good option. While balanced funds will be more risky as the exposure will be 65% to equities, the risk in MIPs will be lesser as equity exposure will be much lesser in MIPs.

You can opt either for SWP option to withdraw a fixed amount monthly or opt for monthly dividend option of MIPs and balanced funds. Though monthly dividends are not assured, you can select funds with an established track record of monthly dividend payouts. You can check these funds from the following links –

https://www.advisorkhoj.com/mutual-funds-research/categorywise-dividends ( Here you can select a category and check the dividend paying schemes in the selected frequency). The tool also shows the return generated by the scheme and the historical dividends.

You can check another tool to compare dividends https://www.advisorkhoj.com/mutual-funds... This will enable you compare schemes basis return and dividend yield of the fund.

If you opt for good performing balanced funds with track record of monthly dividend payouts then the amount you want to earn monthly from your investments can be achieved. Since the investment horizon is 15 years, these schemes could be a good fit provided the risk profile of your parents is moderate to moderately high.

Thanks for writing to us.

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