Safe Mutual Fund Schemes for Senior Citizens

Safe Mutual Fund Schemes for Senior Citizens

The majority of seniors in India have invested in traditional financial products like fixed deposits and other government guaranteed income programs. 

Three main investment goals are typically prioritised by senior investors: liquidity, regular income, and wealth protection. Contrary to other investment vehicles, mutual funds do not have a specific category of funds created just for seniors.

Seniors typically choose investments that offer financial protection together with consistent income to cover daily costs. Since they often have low risk, moderate returns, and moderate to high liquidity.

List of Safe and Performing Mutual funds for Senior citizen

1) ICICI Prudential Short Term Fund ( Debt Funds)

ICICI Prudential Mutual Fund offers a Short Duration mutual fund product called ICICI Prudential Short Term Fund-Growth. This fund was established on October 18, 2001, and has been around for 21 years. 

ICICI Prudential Short Term Fund-Growth is a medium-sized fund in its category with assets under management (AUM) of 14,606 Crores as of September 30, 2022. The expense ratio of the fund, which is 1.12%, is more than what the majority of other Short Duration funds charge.

The 1-year growth returns for the ICICI Prudential Short Term Fund are 4.13%. It has generated 7.87% average yearly returns since debut. Every ten years, the fund has increased the amount invested in it.

• The capacity to consistently deliver returns is higher for the ICICI Prudential Short Term Fund-Growth scheme than for most other funds in its class. It has a strong capacity to limit losses in a market that is dropping.

• The fund has a strong credit history, which suggests that it has provided money to high-quality borrowers. The default risk in this fund is higher than the category average because the majority of funds in this category lend to stronger borrowers.

2) HDFC Medium Term Debt Fund

A debt fund is HDFC Medium Term Debt Fund Direct Plan Growth Option. The first day of 2013 saw the launch of this fund. Priya Ranjan and Shobhit Mehrotra manage the fund's operations. You can safely store your money in this fund.

•  As of 11-11-2022, the NAV of the HDFC Medium Term Debt Fund Direct Plan Growth Option was Rs. 49.3797.

•  HDFC Medium Term Debt Fund Direct Plan Growth Option has an assets under management (AUM) value of Rs.3666 Cr as of September 30, 2022, which is higher than the category average.

•  The cost ratio for the fund is 0.58%.

3) Kotak Debt Hybrid Fund Direct 

A Conservative Hybrid mutual fund product from Kotak Mahindra Mutual Fund is Kotak Debt Hybrid Fund Direct -Growth. This fund was established on January 1, 2013, therefore it has been around for nine years and ten months. 

Kotak Debt Hybrid Fund Direct -Growth is a medium-sized fund in its category with assets under management (AUM) of 1,601 Crores as of September 30, 2022. 

The fund's expense ratio, which is 0.44%, is lower than that of the majority of comparable Conservative Hybrid funds. At the moment, the fund is allocated 24.62% to equities and 67.74% to debt.

Growth returns over the past year for Kotak Debt Hybrid Fund Direct are 4.49%. 

It has generated returns of 10.69% on average every year since start. Every seven years, the fund has doubled the amount invested in it.

• The financial, supplies, automotive, energy, and materials sectors make up the majority of the equity part of the fund's holdings. In comparison to other funds in the category, it has acquired less exposure in the financial and consumer staples sectors.

• The fund's debt portion has a reasonable credit grade, meaning that the borrowers it has lent money to have good credit.

Conclusion

The above-mentioned investment schemes for senior citizens not only provide the best profits, but they also ensure that you retire happily and live your life to the fullest. Therefore, feel free to select the greatest investment plan for seniors.

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FAQs

1) Which mutual fund is best for senior citizens?
Ans - Here are some recommended investment plans for senior citizens in 2023 that offer potential high returns:

 - Senior Citizens Savings Scheme (SCSS): With an interest rate of 8.20% per annum, the SCSS requires a minimum investment amount of Rs. 1,000.

 - Post Office Monthly Income Scheme (POMIS): Offering an interest rate of 7.40% per annum, the POMIS requires a minimum investment amount of Rs. 1,500.

 - Senior Citizen Fixed Deposit (FD): The interest rate for senior citizen FDs varies between banks, providing an opportunity to earn competitive returns.

 - Tax-Free Bonds: Tax-Free Bonds offer interest rates ranging from 5.5% to 6.5% per annum. These bonds provide tax-exempt income, making them a potentially attractive investment option for senior citizens.

2) Where to invest 10 lakhs for senior citizens?
Ans - Here are five recommended investment options for senior citizens in India:

Senior Citizen Savings Scheme (SCSS): The SCSS is a government-backed savings scheme that offers attractive interest rates and a safe investment avenue for senior citizens.

Pradhan Mantri Vaya Vandana Yojana (PMVVY): PMVVY is a pension scheme specifically designed for senior citizens, providing them with regular income and financial security.

Post Office Monthly Income Scheme (POMIS): POMIS offers fixed monthly income to senior citizens and is backed by the Indian Postal Department, making it a reliable investment option.

Senior Citizen Fixed Deposits: Many banks offer special fixed deposit schemes for senior citizens with competitive interest rates and flexible tenure options.

Mutual Funds: Senior citizens can consider investing in mutual funds, particularly debt funds, which provide potential growth and regular income. It is advisable to select mutual funds based on risk tolerance and investment goals.

3) What is the safest investment with highest return?
Ans - High-quality bonds and fixed-indexed annuities are commonly regarded as relatively safe investment options that offer potential for higher returns. However, it's crucial to note that there is a wide range of bond funds and annuities available, each carrying their own set of risks and rewards. It's important to carefully evaluate the specific characteristics and features of these investment vehicles before making any decisions, taking into account factors such as interest rate risks, credit risks, liquidity, and the terms and conditions associated with each investment. Understanding the unique attributes and potential outcomes of different bond funds and annuities is essential to make informed investment choices.