Im new to MF, everything in coin is SIP. im looking to park some money in MIP. does coin has MIP option?
May be this link will help you.
For how long?
for a very long term. Interest i receive from it will be diverted to health insurance policy, so thats the main reason i want to park in MIP.
so lets say i put 1lk in lumpsum, will i get income monthly/periodically? or do i have to wait 15yr to claim like lic policies?
Unless you know what you are getting into, it better if you stick to mutual funds with shorter tenures or better yet invest in t-bills.
MIPs are debt oriented mutual funds which invest between 15% to 25% of the portfolio in equities as a kicker to debt returns. The duration (interest rate sensitivity) of the portfolios varies widely.
By this I am guessing you are expecting this in the form of dividends from the fund. In that case you need to be aware of 2 things:
- Just because the name says “Monthly income” doesn’t mean it is guaranteed
- The dividends a fund declares come from selling your units. Dividends in mutual funds don’t work like stock dividends where a company declares it from its profits
- All dividends from debt funds are taxed at 29.12%
To play safe and get monthly income you can invest in KTDFC FD for 8-8.5% interest rate where the interest payment frequency is on monthly basis. This would help you pay your insurance policy monthly premium with the interest earned. Though there would be TDS involved. http://www.ktdfc.kerala.gov.in/deposites/interest-rates
Alternatively, you can open a Kotak/ Yes Bank/ Digibank account and park that lump sum money into that account which would earn you 6-7% interest per annum. Interest is credited every quarter. You can let it compound or use it to recover for your insurance premium payments you made through your pocket. Also, remember that as per the Income Tax rule, under section 80TTA, bank interest upto Rs 10,000 is tax exempted. So if you have kept Rs 1 Lakh in Kotak Bank and in a year you earned Rs 6000 as interest, it would not be taxed.