For most of us, a month signifies more than just 30 days. It is a constant reminder that the time to pay bills, dues, EMIs, school fees and a never-ending list of expenses, is approaching. We mostly calculate a month in terms of expenses. This makes earning a salary extremely important as without a monthly income, everyday necessities would be difficult to fulfill.
Now, if you think that a salary is the only monthly income you can get, you will be happy to know that a Monthly Income Scheme (MIS) can give you a second source of income.
What Is A Monthly Income Scheme
As the name suggests, a Monthly Income Scheme is an investment that gives you a fixed amount every month for a chosen tenure, depending on the plan. The best monthly income schemes are safe investments that give you high dividends. This can be withdrawn for your use. The schemes are extremely simple and easy to invest in, and can turn your spare cash lying in your saving account into an income-generating investment. There are different types of MIS and these are either Government-backed or run by mutual fund companies. All of these can provide a reliable, steady source of income to enhance your financial security and protect you from unexpected expenses.
Here are 5 of the best MIS schemes 2024 that you should include in your portfolio.
IndiaFirst Life Insurance offers 2 plans - IndiaFirst Life Guaranteed Pension Plan and IndiaFirst Life Guaranteed Annuity Plan – which provide multiple options for annuity income which can be used to fulfil your retirement dreams.
1) IndiaFirst Life Guaranteed Pension Plan Who says an income stops at retirement! IndiaFirst Life Guaranteed Pension Plan is the best monthly income scheme designed to guarantee an income for as long as you live, and even grow consistently, depending on the chosen option. This gives you the financial confidence to indulge in all your interests you never had the time to devote to, during your working years.
What makes this one of the best monthly income schemes:
- Choose from 5 different annuity options
- Extend the annuity benefits to your loved ones under the Joint Life option
- Escalating Life Annuity option grows the annuity amount at a constant rate
- Return of Purchase Price facility provides additional financial security for your family
- Protects financial drain from 20 critical illness
- Pay for a limited period only, enjoy lifetime benefits
2) IndiaFirst Life Guaranteed Annuity Plan
Saving up for retirement to fund your expenses? Save with IndiaFirst Life Guaranteed Annuity Plan and you will get more. The plan features a number of options that help you customise your retirement policy maximise your income to fulfill regular needs as well as desired ambitions.
What makes this one of the best monthly income schemes:
- 12 different annuity options assure you of a regular lifetime income
- Return of Purchase Price facility with options like Life Annuity, Joint Life Last Survivor Annuity, Deferred Life Annuity, Escalating Life Annuity protect your nominee(s) as the premiums are refunded to your loved ones
- Escalating Life Annuity option grows the annuity amount at a constant rate
- Delay your annuity instalments to align with your needs
- Protects financial drain from 20 critical illness
3) Fixed Deposit
The first and obvious choice, is a bank Fixed Deposit (FD), which is also one of the simplest and best monthly income schemes. You deposit an amount for a fixed number of years and earn interest on it, which gets credited to your account as monthly instalments. The rate of interest depends on the tenure of the FD and most banks require a minimum deposit amount. The interest rate could vary depending upon Government stipulations and is taxable at 10% TDS, i.e., tax deducted at source, if it exceeds a certain amount.
Advantages:
- Zero risk saving plus investment
- Easy liquidity
- Higher interest rate than saving account
- Premature withdrawal available in case of emergencies
4) Post Office Monthly Income Scheme
Think that a post office only deals with mail? Post Office Monthly Income Scheme (POMIS) is a Government scheme that is regulated by Indian Post. The interest rate is determined by the performance of the Government bonds of the same tenure that back the funds. Being Government backed, it is the safest which makes it the best MIS scheme for low-risk investors
Advantages:
- Currently the best monthly income plan with a current rate of interest at 7.4%1
- Pays a bonus on maturity
- Easily transferrable across the country
- There is no tax deducted at source on the interest earned but neither is there any tax benefit under Section 80C
5) Mutual Funds SWP
Mutual funds are becoming increasingly popular for their attractive returns, investment options, and capital protection. A mutual fund Systematic Withdrawal Plan (SWP) is one of the best monthly income schemes in India for its many benefits.
Advantages:
- You can choose your monthly income amount which can be either a fixed amount or only the capital appreciation
- There is no tax deducted at source, however, capital gains tax will be applicable depending on the type of the scheme and withdrawal amount
- Protects you from potential losses due to market volatility
These are 5 of the best monthly income schemes that you can choose from to supplement your income. The income you earn from these can also be reinvested in other financial instruments to create a long-term, savings corpus. Speak to your financial advisor before taking a decision.
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