Hi , I need something where i get monthly fixed income , Suppose I invest 1 lakh lumpsum , and monthly 10k or whatever. I just need some monthly income like 2% or something. Any government bonds or whatever.I just want to put my salary in this instead of savings account , which gives only 3.5% . I don’t care about high monthly returns but it should be very low risk ?
I will be either withdrawing that monthly income for personal use or compound it in that mutual fund.
Why do you want to take any risk higher than fixed deposits or something like that ? And what do you mean you have something like 3.5% of monthly income ? Is it really that low ? You mean USD or INR ? I have seen yearly INR like upto 7%, am I correct ?
because I want something monthly , fixed deposit means , per year or 5 years. Also SBI reduced interest rate to 3% for savings account, having balance in bank account is complete waste nowadays.
Its better to do some option strategy and earn monthly 1 or 2 %
nothing like that returns you can get, low risk low returns , in stock market knowledge will pay off simple theory i will explain
for example-
if you ready to invest 100% money and 0% knowledge = low return ( Ex-Real estate, gold ,bond etc return 5 to 8%)
if you ready to invest 50 % money and 100% knowledge = high return ( Equites, derivatives , trader, etc return 15 to 30%)
I have been investing in debt mutual funds (weekly/daily dividend option) via fundsindia.com since 2013. This is no advertisement for fundsindia/valueresearchonline/morningstar, but I did not know about Zerodha or discount brokerage as my capital market was only limited to mutual funds as investment during 2013 time frame. I have learnt immensely about capital markets (stocks/options) via Zerodha in the last 2 yrs.
I have never invested in debt funds via coin and have heard they have some issues with the dividend option (daily/weekly). Someone from Zerodha team can clarify on this.
Since your comparison is with savings account, and your return expectation very low, I presume that you do not really need a monthly income - you just want a safe parking spot for your salary proceeds.
Considering this, you have a wide variety of options in form of government bonds, tax free bonds and bonds from PSus such as SBI NHAI HUDCO etc each of which will give you 6-8% p.a. These will however usually in form of yearly interest payment of maybe even at the end of maturity period. Most of these bonds are listed in the markets and are reasonably liquid as well should you need to liquidate them.
If the ability to liquidate funds immediately is also of importance to you, then FDs might be the best option for you.
Plenty of misinformation and wrong views being shared here. Here are your options.
Complete and absolute safety. Your only option is
Government bonds
Keep buying 91 day T-bills and repeat as they mature. They currently yield about 6.4% (annualized). T-bills are guaranteed by the govt so ZERO risk.
If you want to invest for a duration say, more than 91 days, there are 182 and 364 day T-bills as well. Everyweek there is an auction by RBI and you can purchase them here:
If you want to invest for a duration longer than 1 year then you will have to invest in government bonds. Interest is paid every 6 months. The yields depend on the duration of the bonds. Higher the tenure of the bond, higher the return but higher the risk. I had written a bit about that here:
Invest in a dividend plan of an arbitrage fund but this carries a bit of a risk. So, arbitrage funds, as the name suggest take advantage of the mispricing between cash and derivatives. But the problem here is, if the fund manager doesn’t find arbitrage opportunities, he will move to cash and short-term bonds. Given that there is a drag on returns in case of cash credit risk from the bond portion.
Whatever you don’t invest on dividend plans of debt mutual funds, A DDT of 29% is levied on the dividends.