There are several investment options available in India that can provide regular income, and the best option depends on an individual’s risk appetite, investment horizon, and financial goals. Here are the top 10 best investment options for regular income in India
1) Fixed Deposits (FDs)
Fixed Deposits are a popular investment option that is offered by banks and other financial institutions. They are a safe investment option and provide a guaranteed return on investment. The interest rate for FDs depends on the duration of the FD and ranges from 3% to 7%. FDs have a lock-in period ranging from seven days to ten years.
2) Post Office Monthly Income Scheme (POMIS)
POMIS is a government-backed savings scheme that provides a secure source of monthly income. The scheme has a lock-in period of five years, and the interest rate offered is 6.6% per annum. The minimum investment in POMIS is Rs. 1500, and the maximum investment limit is Rs. 4.5 lakhs for individual accounts and Rs. 9 lakhs for joint accounts.
3) Senior Citizen Savings Scheme (SCSS)
SCSS is another government-backed savings scheme that is designed explicitly for senior citizens above the age of 60. The scheme has a tenure of five years, which can be further extended by three years. The interest rate provided is 7.4% per annum. SCSS investments qualify for tax benefits under Section 80C of the Income Tax Act.
4) Pradhan Mantri Vaya Vandana Yojana (PMVVY)
PMVVY is a government-backed pension scheme that provides a regular stream of income for senior citizens above the age of 60. The scheme has a tenure of ten years, and the interest rate provided is 7.4% per annum. Investors can invest up to Rs. 15 lakhs in this scheme, and the investment qualifies for tax benefits under Section 80C.
5) Annuity Plans
An annuity plan is an investment option that offers regular income payouts for a specific period. This plan is sold by life insurance companies, and the payouts are based on the investor’s initial investment. The returns on annuity plans can range up to 7%.
6) Corporate Fixed Deposits (FDs)
Corporate FDs are similar to bank FDs, but they are issued by companies instead of banks. Corporate FDs offer interest rates ranging from 5% to 9%, making them an attractive option for investors looking for high returns. Corporate FDs have a higher risk associated with them compared to bank FDs.
7) Mutual Funds
Mutual funds are an ideal investment option for long-term investors as they offer a range of options to invest in equities, bonds, and money market instruments. Dividend payout mutual fund schemes can provide regular income payouts, making them a popular option for investors looking to earn regular income.
8) Real Estate
Investing in real estate, specifically rental properties, can provide regular income through rental payments. However, investors should consider the associated risks of property management and the uncertainties of the rental market before investing in real estate.
Bonds are debt securities that are issued by the government or companies to raise funds. Bond investors receive regular coupon payments and repayment of principal at maturity. NCDs, tax-free bonds, and debentures are some popular options for investing in bonds.
10) Equity Dividend Stocks
Dividend stocks can provide regular income to investors, as some companies distribute a portion of their profits as dividends to shareholders. These stocks can provide high dividend yields over an extended period, making them an attractive option for investors.
In conclusion, the above-mentioned investment options can be a great way to generate regular income for investors, depending on their risk appetite, investment horizon, and financial goals. It’s crucial to determine the investment option that suits your needs and consider consulting a financial advisor before making an investment.