What are the Best Investment Options for Your Father?

For most of the people, their father is an ideal figure. The father makes every possible effort to keep their child happy no matter what. Now, it is the time to fulfill your responsibility or to do something for him so that he can live a happy and healthy life in the future. If you’re in your twenties and your father is nearing his retirement, you really should read this article. This time is the most important when it comes to saving for his retirement and you could help him with that by planning the same with him. Unless his plan is to work for as many years as he can or has a business which generates revenue with little or no supervision.

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Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.

The first step is figuring out whether your father has enough saved for his retirement. The pension epidemic is real in the US where more than 30% of the population above 55 does not have even one tenths the amount of money they need to retire comfortably, saved. The positive side about your father being in his 50s is that his salary is likely to be at its all-time high.

The investment options that you must check for the retirement needs of your father are senior citizen savings scheme, equity oriented mutual funds through SIPs or systematic investment plans, mutual funds monthly income plans, and pension plans. With a retirement plan, your father can fulfill all his dreams that he could not due to his busy schedule such as to go on a vacation. Your father must start investing as early as possible so that he can enjoy maximum benefits in his retirement age. You must do sufficient research before investing in any investment plan for your father. The online medium provides a great support in comparing the features and benefits of various investment options according to your requirement. Research helps to select the best investment option as per your need and budget.

Check out some of the best investment plans available in the Indian market that will help to fulfill the future requirements of your father:

Senior citizen savings scheme

Senior citizen savings scheme is for senior citizens of age 60 years or above. This scheme does not involve risk and it is a tax saving instrument. As per section 80C of the Income Tax Act 1961, you are eligible for a tax deduction of Rs. 1.5 lakh. In order to open a SCSS account, you will have to fill a Form A. You will have to submit some self-attested documents in order to complete the process. The tenure of this scheme is 5 years. You can get your tenure extended for further 3 years. In order to get your tenure extended, you will have to submit a form B. You can get the tenure extended only once. After one year of extension, you can easily get your extended account closed without paying any penalty. There are various banks that offer senior citizen savings scheme including Allahabad Bank, Bank of India, ICICI Bank, Indian Overseas Bank, State Bank of India, Punjab National Bank, and more. The return that is provided under this scheme is more than the saving or fixed deposit account. The return rate of this scheme is 8.6%. It is one of the safest and reliable investment options for senior citizens as it is sponsored by the Indian government. It is quite easy to get your SCSS account opened. NRIs and HUFs cannot invest in this scheme. The maximum amount that can be invested by a person via single or joint SCSS account is Rs. 15 lakhs. You can open your account for an amount below Rs. 1 lakh by cash or for an amount above Rs. 1 lakh by cheque.

Invest in equity oriented mutual funds through SIPs or systematic investment plans

You can make an investment in equity oriented mutual funds through SIPs or systematic investment plans over a few years till the retirement age. This investment option assures decent returns and also safeguard the interest of investors of any loss occurs because of flux in the market. You can plan to invest in mutual funds depending on the retirement age of your father. Make sure that you invest in those equity oriented mutual funds which have a good record. You must do thorough research before investing in any mutual fund. When the retirement time is near, you can pull out the corpus and get it converted into a fixed deposit.

Mutual funds Monthly Income Plans (MIPs)

Mutual funds monthly income plans (MIPs) provide monthly income to the investors. Though, there is no guarantee of this monthly income. Majorly, the amount is invested in debt instruments. The investment is also made in equity but in a very small quantity. Monthly income plans provide you a higher interest rate in comparison to bank deposits. That is why MIPs are one of the best investment options available in the Indian market that you must refer if you are looking for an investment option for your father.

Pension plans

It is also a good decision to invest in a pension plan for the purpose of retirement needs. There are some pension plans that also provide entry at the age of 65 years. So if your father has retired now then also you can make an investment in a pension plan for your father retirement needs. After the completion of policy tenure, the policyholder is provided with a monthly income. The pension plan provides an option to the policyholder to withdraw one third of the lump sum amount and further invest it in some other option. Unit linked insurance plans and traditional pension plans are the two types of pension plans. Most of the pension plans provide tax advantages to the policyholder.

Conclusion:

A father does everything for his child so that he or she can live a happy and healthy life. For this, the father leaves no stone unturned no matter what. Fathers do a lot of planning for their child from the very beginning. As you grow old, it also becomes your responsibility to take of your father. You can help your father by saving for his retirement needs or helping him to plan for the future requirements that may arise at the time of retirement. If you have reached in your twenties then you must start helping your father to plan for his future requirements. Most of the fathers are not able to fulfill their wishes due to their busy schedule. The fund from a retirement plan can help to fulfill various wishes of your father such as to go on a trip to India or outside India. You must start investing as early as possible so that you can enjoy maximum returns in the future. There are various retirement plans that help to build a corpus for the future. You can ask your friends, relatives, and other people for their opinion before making an investment. You can check the ratings and reviews of various investors via online medium.

Senior citizen savings scheme, equity oriented mutual funds through SIPs or systematic investment plans, mutual funds monthly income plans, and pension plans are some of the best investment options available for the retirement requirements of your father. If you want to help your father in planning for his retirement needs then you must first check out these investment options. Make sure that you do a thorough research before investing in an option. Sometimes, we end up making a wrong decision because of making a decision in hurry without doing sufficient research. A wrong decision can waste your money. So it is better to do sufficient research at first so that you can select the best investment plan as per your budget and need. These days, online medium provides a great help. With just a few mouse clicks, you can get all the important information related to various investment options available for retirement needs. Also, remember to not delay your decision as due to this you will not be able to achieve maximum benefits in future at the time of your retirement.

Senior citizen savings scheme is for senior citizens who are aged 60 years or above. This investment option does not involve risk and it is a tax saving instrument. According to the section 80C of the Income Tax Act 1961, you are eligible for a tax deduction of an amount of Rs. 1.5 lakh. You will have to fill a Form A, in order to open a senior citizen savings scheme account. You can get your account opened in a certified bank or post office available in India. The investment can also be made in equity oriented mutual funds through SIPs or systematic investment plans over a few years till the age of retirement. You can plan the investment in mutual funds according to your retirement age. Those equity oriented mutual funds should be preferred which have a good record. Make sure to do enough research before selecting any mutual fund according to your need. Both senior citizen savings scheme and equity oriented mutual funds through SIPs or systematic investment plans are good investments options for the retirement needs of your father.

If you are looking for an investment option that provides monthly income then the best investment option that you must check is mutual funds monthly income plans or MIPs. In this investment option, a majority of the money is invested in debt instruments. A very small amount of money is invested in equity. This investment option is better in comparison to bank deposits as it has a higher interest rate. So it is one of the best investment options available in the market for the investors. Another popular investment option for the retirement needs is pension plans. You can easily buy a retirement plan even at the age of 65 years; this is one of the best things about pension plans. If your father has retired just now then also you can make an investment in a pension plan for fulfilling the retirement needs of your father. The policyholder is provided with a monthly income once the policy tenure is over. You can easily withdraw one third of the lump sum amount and further invest it in some other option. The two types of pension plans are unit linked insurance plans and traditional pension plans. The policyholder can enjoy various tax benefits by investing in most of the pension plans.

If you are looking for an answer to various questions including:

Which is the best investment plan for your father?
How could I save for the retirement needs of my father or help him save for the same purpose?
How to open a senior citizen savings scheme account?
Why investing in equity oriented mutual funds through SIPs or systematic investment plans for your father retirement needs is one of the best decisions?
Why mutual funds monthly income plans are one of the best investment options available in the Indian market?
Is it worth to invest in pension plans for the purpose of retirement needs?

Then you are at the right place; please refer to the above mentioned in order to get answers to all of your questions.

†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

Past 10 Years' annualised returns as on 01-12-2024

^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.

*All savings are provided by the insurer as per the IRDAI approved insurance plan.

Tax benefit is subject to changes in tax laws. Standard T&C Apply
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^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CARG 8%; ₹50,45,591 @ CAGR 4%

¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.

**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).