Reliance Retirement Fund – All You Need to Know

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Reliance Retirement Fund

As a young professional, working in a top-notch organization, Shikha is able to make a handsome amount of money every month. She enjoys her life thoroughly, lives in a beautiful home, visits new destinations every year and also has a lump sum amount of money saved to handle any unforeseen circumstances.

However, the only problem with Shikha is that she is not able to make a sizeable contribution to her savings account. Like every other youngster these days, she too, struggles a lot with budgeting and one of her biggest concerns is to save enough for her sunset years.

Thankfully, investors these days have an abundance of plans that you can invest in to save for your retirement. However, finding the right scheme has never been an easy task. If we look into the different retirement funds available in the Indian insurance market, the newly launched Reliance Retirement Fund is dominating the market.

The biggest advantage provided by this particular plan is that you don’t have to worry about buying annuities like in other plans such as the National Pension Scheme (NPS), etc. As an alternative, you can choose a systematic withdrawal so you can manage your periodic cash flow requirements. Also, you would be withdrawing a part of your principal amount with it, so it is going to be more tax-efficient for you.

Why Reliance Retirement Fund? 

While the terms used in the name of Reliance Retirement Fund are self-explanatory enough to attract investors. Here are few of the most important features of the fund that explain what makes it different from its competitors:

  • You can repeatedly subscribe to and repurchase the Reliance Retirement Fund (RRF) and that’s why, it is also known as an open-ended scheme. This scheme also doesn’t have a fixed maturity term.
  • RRF has received permission from the Central Government of India, making it the first Notified Retirement Fund by the insurance firm.
  • It offers two different types of investment portfolios for the investors. They are:
  1. Wealth Creation Scheme: In this investment portfolio, 65-100% of the funds are meant to be invested in equity or equity-based instruments. Hence, it’s an equity-oriented plan offered by Reliance Mutual Fund. The remaining 0-35% funds are invested in money market and debt related instruments.

This scheme is meant for the particular period (Accumulation Phase) an investor is supposed to start building up her/his savings.

  1. Income Generation Scheme: In this scheme, 70-95 percent funds are invested in debt instruments and the remaining 5-30 percent funds are invested in equity, making it a debt-oriented plan.

This scheme is specifically meant for the particular phase when an investor is nearing her/his retirement age and is not in a position to take risks.

  • The best part about it is that the investors can choose to switch between these 2 investments portfolios, at any point of time, under the ‘Auto Transfer’ facility.
  • Under this facility, the investors can easily switch between the 2 schemes with their entire investment, without paying any exit load. The investor can choose any specific date to do so (during or after the lock-in period or once s/he has reached the age of 50 years).
  • The lock-in period for Reliance Retirement Fund (RRF) is 5 years.
  • In case, you choose to sell your units before you reach the age of 60 years, there will be an exit load of 15 percent applied on the sale.
  • One can also use the SIP (Systematic Investment plan), Lump sum or Step-up mode. Step-up option allows the investors to increase their SIP amount by a certain amount at previously defined time periods.
  • The Systematic Withdrawal option (both manual as well as the automatic one) gives an option to the investors to withdraw money during their retirement phase. The Auto Systematic Withdrawal option will allow the investors to avail of a regular cash flow on a monthly/quarterly/annual basis once they have attained the age of 60 years.
  • You can also claim a tax rebate for the tax investments made under this retirement scheme, for an amount up to Rs 1.5 lakhs in the current financial year. The tax rebate is applicable under Section 80C of the Income Tax Act 1961.
  • One of the most distinct features of this plan is that even employers can buy and incorporate this scheme into their employee benefit scheme. They can enrol into this scheme by deducting the SIP instalments from the salary of their employees.
  • RRF offers two different pay-out options for its investors:
  1. Growth Pay-Out Option
  2. Growth Oriented
  3. Bonus Oriented
  4. Dividend Pay-Out Options
  • The minimum amount you can start your Reliance Retirement Fund with, are:
  1. Rs 5,000 for the Lump sum investment
  2. Rs 500 for Monthly SIPs
  • Rs 1,500 for quarterly-based SIPs
  1. Rs 5,000 for Annual SIPs


With all the features associated with RRF listed in this article, you can now weigh the pros and cons of this scheme and make a better decision about where to make your investments. With a little more research and financial consultation from a reliable source, you can build a good investment portfolio to take care of your golden years.