How To Park Rs 60 Lakh For Safe Rs 10-20k Monthly Income Post-retirement

My dada conscionable retired pinch a Rs 60 lakh corpus and needs Rs 10-20,000 monthly income pinch minimal risk, positive immoderate costs near for my wedding successful a year. SBI sounded him a ULIP, but I’m wary of locking money for 5 years. I’m considering SCSS, bonds, a mini SIP successful Nifty funds, and FDs—does this scheme make sense, aliases is location a amended measurement to equilibrium information and returns?

Advice by Rajani Tandale, Senior Vice President, Mutual Fund astatine 1 Finance

Generally, ULIPs are pushed by banks because they gain precocious commissions from security companies. However, ULIPs person importantly higher disbursal ratios compared to communal costs aliases different market-linked finance options. The first norm of smart financial readying is to support security and investments abstracted - ne'er operation nan two.

ULIPs typically travel pinch a 5-year lock-in, precocious first charges, and market-linked returns, making them unsuitable for personification seeking predictable income and liquidity, particularly successful nan short term. They besides blur nan statement betwixt security and investment, often compromising nan effectiveness of both.

Since your begetter has conscionable entered retirement, nan attraction should beryllium connected superior preservation and dependable returns, not connected fierce aliases long-locked maturation products for illustration ULIPs.

A More Suitable Approach

Let’s break down a much effective strategy utilizing safer, much liquid and tax-aware options:

1. Senior Citizen Savings Scheme (SCSS)

This is simply a government-backed strategy specifically designed for retirees. It offers a fixed return (currently astir 8.2% per annum) and quarterly payouts - perfect for generating unchangeable income. Your begetter tin put up to ₹30 lakhs and expect a quarterly income of astir rs.61,500, translating to a monthly mean of Rs. 20,500, which perfectly meets nan income requirement.

SCSS has a 5-year lock-in, but premature withdrawals aft 1 twelvemonth are allowed pinch minimal punishment - offering a reasonable equilibrium betwixt return and liquidity.

2. Fixed Deposits (FDs)

Senior Citizen FDs successful banks for illustration SBI, HDFC, and ICICI connection ~7.5–8% interest. A information of nan corpus (say ₹10–12 lakhs) tin beryllium kept successful short-term FDs (1-year tenure) to money your wedding aliases emergency needs. You whitethorn besides see FD laddering (e.g., 1-year, 2-year, 3-year tranches) to amended liquidity without sacrificing returns.

3. Debt Mutual Funds

These costs put successful authorities and firm bonds, offering mean but comparatively unchangeable returns. While they do transportation immoderate marketplace consequence - specified arsenic liking complaint consequence aliases in installments consequence - high-quality indebtedness costs (like short-duration costs aliases target maturity funds) tin output astir 7%–8% annually successful favorable conditions.

Unlike SCSS, indebtedness communal costs do not person a lock-in period, offering amended liquidity and flexibility. However, taxation is akin to SCSS, arsenic superior gains connected indebtedness communal costs are now taxed arsenic per your income taxation slab, sloppy of holding play (post-April 1, 2023 changes).

If you're looking for mean returns without locking successful your money, and are comfortable pinch somewhat higher consequence compared to fixed-income instruments, indebtedness communal costs tin beryllium a suitable portion of your portfolio.

4. Equity SIP successful Nifty 50 Fund

Since your begetter has debased consequence appetite, limit equity vulnerability to 5–10% of nan corpus. A mini SIP successful a Nifty 50 scale money tin thief hit ostentation complete nan agelong term, but it’s not intended for contiguous income needs.

> Common Mistakes to Avoid

• Chasing precocious returns done ULIPs aliases PMS (unsuitable for low-risk investors)
• Choosing endowment aliases money backmost policies mostly mis-sold by banks.
• Locking nan full corpus successful semipermanent instruments without liquidity planning

Final takeaway

You’re reasoning successful nan correct direction. Avoid nan ULIP trap and instrumentality pinch a operation of authorities schemes (like SCSS), slope FDs, and indebtedness communal funds. This attack offers unchangeable income, liquidity for nan wedding, and reasonable semipermanent returns - each while keeping consequence successful check. Consulting a SEBI-registered fee-only financial advisor tin thief fine-tune this strategy for your father’s unsocial needs.

Published on: Jul 9, 2025 2:29 PM IST