20/02/2024 | 4 Comments

We all look forward to having a steady income stream for our financial stability. But how can you achieve this financial stability? Well, one of the best ways is to invest wisely and earn monthly return to secure your future.

Here, we list down the top monthly income investments you can consider for generating passive income in India. The list includes all the popular monthly income plans wherein millions of people invest regularly.

Factors to Consider Before Investing In Monthly Income Schemes

Before investing in monthly income schemes, you must consider your risk appetite, investment horizon, and tax implications. Make sure to assess your financial goals and the credibility of the investment options to ensure a steady and reliable income stream.

Best Monthly Income Plans You Should Consider

Fixed Deposits (FDs)

Quite a popular choice for the people of India for generating monthly income! Fixed Deposits offer a fixed interest rate over a predetermined period, typically ranging from a few months to several years. So, you invest a fixed amount in your FD every month and get interest as a return. FDs are low-risk investments and are backed by banks or financial institutions. This is why they are often considered a secure option for conservative investors. You should also keep in mind that the interest earned here is taxable.

Post Office Monthly Income Scheme (POMIS)

You can also invest in the Post Office Monthly Income Scheme. POMIS is one of the popular post office schemes backed by the Government of India and provides a fixed monthly income to investors. It usually has a tenure of five years and is perfect for those seeking stability and regular payouts. Offering guaranteed returns, POMIS provides you with interest rates that are relatively lower than market rates.

Also Read: Best Monthly Saving Schemes & Plans Every Indian Must Know About

Mutual Funds – Monthly Income Plans (MIPs)

Mutual Funds are a great source of monthly income. You can invest in the Monthly Income Plans (MIPs) that provide you with regular income. MIPs are like pots of money managed by experts. These experts put some of the money debt instruments and some into buying ownership in companies, which is the equity part. They do this to try to find a good balance between getting regular income and the value of the money growing over time. While MIPs offer the potential for higher returns than traditional monthly income investments, they also carry higher risks due to market fluctuations.

Dividend-Paying Stocks

Several companies listed on the stock market distribute a portion of their profits to shareholders in the form of dividends over time. Investing in these dividend paying stocks can provide you with a regular source of income. However, it should be noted that dividend income is not guaranteed and depends on the company’s performance. Moreover, stock prices are subject to market volatility and hence, can affect your overall returns.

Real Estate – Rental Income

Rental property income can play a significant role in building your financial stability. Real estate is often considered a safe investment avenue as it can easily generate monthly income. If you are capable, you can purchase either residential or commercial properties and earn rental income from tenants. This income provides a steady cash flow every month. But as we all know, real estate investment requires substantial capital and hence, is not everyone’s go-to investment option.

Systematic Withdrawal Plans (SWPs) – Mutual Funds

Systematic Withdrawal Plans

Mutual Funds also offer Systematic Withdrawal Plans (SWPs) wherein you can withdraw a fixed amount periodically and generate a regular income stream for yourself. You can choose the frequency and amount of withdrawals based on your financial needs. However, SWPs are often subject to market risks and the withdrawal amount may vary depending on the fund’s performance.

Corporate Fixed Deposits

Corporate Fixed Deposits are the fixed deposits offered by corporate organisations. They usually offer higher interest rates than bank FDs and this is why it is popular amongst investors seeking higher returns. But corporate FDs carry higher risk in comparison to bank FDs as they are not backed by the government and hence, are subject to the financial health of the issuing company.

So, these were some significant monthly income investments you can consider. Whether you prefer fixed-income investments like FDs and POMIS or the higher returns offered by mutual funds and dividend-paying stocks, it is important to diversify your portfolio. If you are unaware of the finance world, it is wise to consult a finance advisor. Moreover, if you are looking for higher returns in the long run, then you can also consider peer-to-peer lending.

Also Read: P2P Lending: The Future of Borrowing and Investing

How 13Karat Can Help You With Investments

13Karat offers the best investment plans to cater to your financial needs. You can invest your money in the 13Karat 6-month investment plan (offering a return of up to 13% per annum) or the 3-month investment plan (offering a return of up to 12% per annum). With these investment plans, you can benefit from flexible and shorter-term options to grow your wealth