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Want to invest 5-7 Lacs for 3-5 years and need monthly income

My age is 43 and I doing job in Kurdistan Iraq. I want invest lump sum amount around 5 to 7 lakh for 3 to 5years, and after need monthly income for family. I am middle-class family person, so please suggest me what is best for me after 5 to 7 years that time my age 50 years please search very good policy or investment plans for middle-class person's. I waiting reply all your team?

Feb 22, 2016 by Boby, Mumbai  |   General

You have not provided sufficient details in your query. You should firstly determine how much monthly income does your family need. What do you expect your financial situation to be after 5 – 7 years. In other words, do you plan to continue working or will you retire after 5 – 7 years. This is important, because this will determine how you should invest your lump sum amount. Finally, it also important for you understand, how much income you will continue to get from your current savings and investment.

For example, if you depend on your investment income only for your family after 5 – 7 years, you cannot take too much risks. On the other hand, if you continue to work even after you are 50, you can definitely take more risks. You should understand that, risks and returns are directly related. The more risk you take, the more return you get. This is known as risk premium. On the other hand, taking too much risk can cause financial instability. Therefore, hybrid funds are good investment options for you. Hybrid funds invest in both debt and equity. Debt provides stability and lowers the risk, while equity gives good returns. Depending on how much income you need after 5 – 7 years and the risk you can take, you can choose between equity oriented hybrid funds and debt oriented hybrid funds. Equity oriented hybrid funds can give higher returns but also have higher risks (please see top performing equity oriented hybrid funds, also known as balanced funds, by going to our mutual fund research section, Top Performing Mutual Funds - Balanced Funds Equity Oriented). Debt oriented hybrid funds have much lower risks, but also give lower returns (please see top performing debt oriented hybrid funds, by going to our mutual fund research section, Top Performing Mutual Funds - Hybrid Debt Oriented Funds). When choosing a good mutual fund, pay attention to their long term returns and the reputation of the asset management company or fund house.

It is always prudent to separate insurance and investment needs. An insurance policy whether traditional or ULIP, is not the best investment option because you get much lower return on investment in traditional plans. Further most ULIPs are quite expensive in the first five years, which is the investment horizon you are looking at. If you want to buy sufficient life insurance for your family to ensure their financial security in the event of an unfortunate death, you should buy a term insurance plan instead of endowment, money or unit linked plans (please see our article, How to select the best term life insurance plan for you)

If you want more guidance from us, we will be glad to help if you provide some more details, as discussed above. Also, it is always a good idea to consult with a financial advisor, who can discuss your financial needs with you and help you select the right investment. You can find a financial advisor near your hometown in India by going to the homepage on our website, https://www.advisorkhoj.com. We have close to 40,000 financial advisors in our network. On the home page, go to the section which says, Find a Mutual Fund Advisor or Investment expert near you. Just type the name of your city or pincode in India, and we will show a listing of all the financial advisors near your India address. You will surely find a financial advisor who works in the area of your India home. You can select any advisor based on your preference and contact them through email or phone, which are also shown on our website.

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