Achieving complete financial freedom is a road full of hardships, and for some it is almost impossible. But this fact doesn’t entirely leave you out of the path to achieving financial success. You can ease your burden up to an extent by opting for specific investment plan to source a secondary income. And for this, you will have to learn about monthly income schemes.
About Monthly Income Scheme
In simple terms, Monthly Income Schemes let you invest specific monthly amounts to earn interest on them. The interest amount is credited to you as per the rules of the investment scheme. You will receive it either quarterly, monthly, half-yearly or annually.
Top 6 Investment Plans to Have a Secondary Income
1. Systematic Withdrawal Plan or SWP
A systematic Withdrawal Plan or SWP is an investment facility offered to investors. This plan enables them to withdraw from the Mutual Fund scheme periodically. This amount is fixed and can be used in a variety of mutual funds of every type, like equity, hybrid, or debt. You can even customize the withdrawal frequencies as per your need.
2. Post Office Monthly Income Scheme (PMOIS)
If you want to get monthly returns, then Indian Post has introduced the Post Office Monthly Income Scheme or PMOIS. The scheme is currently offering a whopping 7.4% annual interest, calculated and paid monthly. The contribution period for this scheme is five years, during which a person can contribute up to ₹4,50,000 and can start investing from ₹1,500. Furthermore, joint accounts can invest up to ₹9,00,000.
3. Senior Citizen Savings Scheme
Senior Citizen Savings Scheme or SCSS is a Government backed savings scheme in which only Senior Citizens aged 60 or above can invest. This scheme pays an annual interest rate of 8.2%, which is payable weekly. The deposit period for SCSS is five years, and early withdrawals can attract penalties. Investors can also get tax relaxation under section 80C.
4. Long-Term Government Bonds
For investors who prefer low-risk investments, the Long Term Government Bonds are the best option. These bonds have a maturity time of 5 to 40 years. They offer monthly interest or give payouts as per the Government. With a fixed maturity date, they offer an interest rate of 8%.
5. Equity Share Dividends
With higher risk, Equity Share Dividends can offer a regular income and gains over the investment in the long term. To get a high dividend ratio, you must select a diverse portfolio of various stocks.
Also read:Bank Revised FD Interest Rates: This Bank Has Increased The Rates Of Fixed Deposits, Know The New Rates Details Here
6. Annuity Plans
Backed by Indian Insurance companies, Annuity Plans offer a continuous income with lower risk. This scheme can be utilized as a retirement plan. You can invest a lump sum amount to enjoy financial benefits periodically.