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How to invest retirement money safely to get monthly returns

Next year I will be retiring & the total money that I will be receiving for retirement is 70 Lakhs. Kindly suggest a portfolio for me where I should invest this fund with low risk. Also to mention I require a regular return of Rs. 40,000 per month to look after my domestic expenses?

Sep 16, 2016 by Tarun Dhali, Bhubaneswar  |   Mutual Fund

The low risk investments can be availed by keeping your money in mutual fund debt funds or hybrid debt oriented funds (also known as MIPs). Hybrid debt funds (MIPs) will have 5% - 25% equities in its portfolio, therefore, slightly riskier than debt funds but these can deliver superior returns than debt funds.

After investing in debt funds or MIPs, you can opt for monthly SWP. You can withdraw a fixed amount of Rs. 40,000 on a fixed date through SWP and meet your monthly expenses.

Since you want to withdraw only Rs. 40,000 per month from an investment of Rs. 70 Lakhs, the yield works out to approx 7% per annum. Therefore, you will have some reserve and capital appreciation as well as these two category of funds has the ability to deliver double digit returns.

To know more about SWP, please try this SWP research tool - https://www.advisorkhoj.com/mutual-funds... (SWP from a debt fund)

To know further about SWP, please try this SWP research tool - https://www.advisorkhoj.com/mutual-funds... (SWP from a MIP fund)

As you can see how the SWPs have worked in case of both the funds and the capital appreciation thereafter. Though this is past performance, you can still estimate how much returns to expect from your investments?

SWP from debt funds and MIPs are also tax efficient. How? Read this - https://www.advisorkhoj.com/company...

The other thought is that if the funds are performing well and giving double digit returns then you might as well think of increasing your monthly SWP amount every year to the extent of rise in the inflation rate.

Hope the above helps! Thanks for writing to us.

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