Senior citizens no longer depend on others to solve their financial problems.They now, from very early on start building a solid retirement portfolio.This ensures that they invest their capital funds judiciously.Investing in only one segment won’t give them the required returns.They have to put their fingers in varied pies to get exceptional returns.
Of course, senior citizens face certain hiccups such as inflation, rising medical costs and the fact that senior citizens are living more than over, that means that retirees must ensure that they don’t outlive the retirement funds. Yes, one retires at 58-60 while they can live till 80 or 90. So, here are some best investment options for senior citizens that you must explore to get a regular stream of income.
The Perfect Investment Options for Senior Citizens –Explore and Invest
· Senior Citizens Savings Scheme- This investment is perfect for people who are 60 or who are over the age of 60. Voluntary retirees can also invest once they reach the age of 55. You can open a joint account with your spouse. The maximum limit is Rs. 15, 00,000 and it is irrespective of the number of accounts you have. The current rate of interest is 8.5%. The interest is paid quarterly.
· Senior Citizens Pension Plan or Varistha Pension Bima Yojana-This is an annuity plan where the payments are made periodically to the policyholder. It is suitable for anyone above the age of 60. The investment limit is Rs. 63,960 and the maximum amount can go up to Rs. 6, 39,610. The pension is taxable and monthly payouts are possible. The returns are around 8%.
· Post Office Monthly Income Scheme (POMIS) - This is available for whoever is 10 years or older can invest. The minimum investment limit is Rs. 1500 and the maximum go up to Rs. 4, 50,000 in the case of a single account holder and double the amount- Rs. 9, 00,000 in the case of a joint account holder. The fixed monthly interest rate is 7.7%. Monthly payouts are also possible. When the amount reaches maturity it can be re-invested in POMIS.
· Bank and Company Deposits- This may turn out to be one of the oldest forms of investment options for senior citizens, it is still one of the more bankable forms of investment. One can invest money in the company deposits for greater interest returns. The rate of interest is much higher than the Bank FD interest rates. The age limit is 10 years or older for a solo account for a joint account it can be younger than 10 years. The investment limit ranges from Rs. 5000 to more than a crore depending on the bank or company. The Interest rate is 0.5% higher than normal fixed deposit rates for senior citizens. It is from 4%-8% for banks and for Company deposits it is 8%-8.90%.
· Mutual Funds-Senior citizens can invest some amount in Mutual Funds, especially the ones which have a lower risk. They can invest in debt funds, liquid funds and so on, that invest in various commercial paper, different bonds, and government securities and so on. They can give good returns and can beat inflation. Monthly income plans can provide regular income. But mutual funds are subject to certain market risks.
· Tax-free bonds - Tax-free bonds, (not available in the primary market) can prove to be an integral part of a retiree's portfolio. There are government-backed institutions that issue these bonds. Some of the institutions are as follows, National Highways Authority of India (NHAI) Indian Railway Finance Corporation Ltd (IRFC), Power Finance Corporation Ltd (PFC), Housing and Urban Development Corporation Ltd (HUDCO), Power Finance Corporation Ltd (PFC), NTPC Ltd and Indian Renewable Energy Development Agency, Rural Electrification Corporation Ltd (REC) and so on.
· Immediate Annuities – Senior citizens can try their hand at investing in immediate annuity schemes of life insurance companies. The annuity stands at around 5-6 percent per annum and it is completely taxable. However, the amount used to buy the annuity is not returned.
Senior citizens can also enjoy a good post-retirement life if they plan ahead and make well-thought-out financial investments. So, go ahead and invest right and enjoy your sunset years in peace and harmony.
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