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How to get regular returns from retirement corpus

Am an avid reader of your post and get mails on regular basis I try to re-read most of your mails which I have saved. I am a Mutual Fund Distributor & do Life Insurance for IPRU from Vellore. A client and close friend of mine has 40 Lakhs retirement corpus fund which he wants my advice to invest in funds so he can have a regular monthly income while his corpus also grows. 1) Time is for 1/3/5 years withdrawal of corpus if needed, 2) Staggered amount for all 3 time frame, 3) 30% IT bracket, 4) Pension received is 55K & house rent 25K/9% on 25 lac deposit are his income now, 5) Post Tax he needs at least 1.5 lac for a comfort living with travel, 6) He is yet to decide if he will be working further if so his earnings from that is not taken into account, 7) At 60 he is in good health still uses the gym to keep fit, 8) No liability except home loan, 9) wife is working as consultant approx pay pack 50k/ month?

Dec 12, 2016 by Nandakumar,   |   Retirement Planning

We have gone through your detailed query and find that the main point is how your client can utilise Rs. 40 Lakhs to get a regular income.

He is already having pension and house rent income, but there is a shortfall in the total monthly income and therefore he wants to invest this Rs. 40 Lakhs in order to compensate the short fall in his monthly requirement.

For those looking for regular income in the medium to long term along with some capital appreciation, SWP from balanced mutual funds is the best and probably only option, provided one has moderate to moderately high risk taking capacity. Those with slightly lower risk taking capacity they can invest in debt funds or hybrid debt funds and opt for SWP.

You have mentioned ‘time is for 1/3/5 years withdrawal of corpus if needed’ - We are not sure what do you mean by this statement?

Simply speaking, if one wants to opt for SWP from balanced mutual funds, then investment horizon should be 5 years or more and if the investment horizon is less than that, then one should opt for debt funds or debt oriented hybrid funds (also known popularly as MIPs). We have done some articles on the above topic along with examples of SWP returns of various funds, please go through the same in order to acquire further knowledge to advise your client.

A smart option for getting regular income from balanced funds

SWP – ICICI Prudential Balanced Funds

SWP – SBI Magnum Balanced Fund

SWP – Birla Sun Life Balanced Fund

SWP from debt mutual funds give the most tax efficient income

SWP from debt funds give most tax efficient income over fixed deposits

Hope the above helps. Sorry for replying late to your query.

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