March 16, 2011 1:19 pm
I need your advice. I would like to Invest around 5L in HDFC’s Monthly Income deposit(that gives me 9%) and SIP the monthly return in to any two mutual funds(It’s like Postal MIS + SIP).
What you guys think about this
Dear advait, First of all please note that HDFC MIP Long term plan is a hybrid MF (around 20% Eq. part & balance is from debt). Hence no guarantee of return is there. I’m unable to understand how you come to 9% return figure?
The income received from plan in the form of dividend is tax free in the hands of investors but the same is liable for Dividend distribution tax which is paid from the fund corpus, hence the net return is lower than what you are assuming.
If capital protection is your primary object & you want to get a kick in return from Eq. investing. Here is the way –
Invest 4.5L Rs. in POMIS. You ‘ll receive a gtd. mly income of 3K Rs. Invest this 3K Rs. in a good Eq. MF like HDFC Top 200 thru SIP every month. For balance 50K Rs. just invest in a one lump sum into HDFC MIP Long Term Plan growth option for next 3Y at least.
This way your basic capital of 4.5L Rs. in POMIS is secure & after 6Y period you ‘ll get the 5% bonus also.
First of all You have to pay tax for your interest.
If you still continue with this method, then conider Canara Bank 10 year FD that gives you 9.5% and 10.5 for Senior citizen.
It’s a short tenure of 3 yrs. I am trying to explore the combination of FD and SIP to create good amount for future. The goal is at the end I have safety with respect to my principal and extra amount exposed to equity through SIP.
What is your target for returns and in how many months/years? Based on the same call can be taken.
Can you please share details on the HDFC’s Monthly Income deposit? Any terms and conditions?
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