Monthly Income Plans by Mutual Funds

Monthly Income Plans by Mutual Funds

Article Summary…..

Monthly Income Plans by Mutual Funds

At present there are more than 35 Mutual Fund Companies which provide you Monthly Income Plans as a product to give you some income through Dividends or systematic withdrawals. Some of the companies are

◿Franklin Templeton Mutual Fund.
◿ICICI Prudential Mutual Fund.
◿Birla Sun Life Mutual Fund.
◿Reliance Mutual Fund.
◿SBI Mutual Fund.
◿IDFC Mutual Fund.

What is Monthly Income Plan - MIP?

MIP is a kind of mixed product with combination of Equity (Shares) and short or long term Bonds. The product is claimed to give you returns better than fixed deposits. Generally the equity part is responsible for the extra returns.

Equity is an asset class which is to be seen for long term only. Since equity has 15% to 25% share in the portfolio of this product, risk element goes up for the investor.

What are the benefits of these plans?

These plans come with risk and have potential to erode your capital also. Because of being a mixed product, it has higher expenses also. In total there is low risk to reward ratio in the product.

Is there any Tax benefit?

The return from the product falls in Capital Gains Tax of debt schemes. If the return is in the form of Dividend, it is tax free in the hand of investor.

The dividend is paid, after the deduction of Dividend Distribution Tax. Any gain from the sale of units before a year is clubbed in the income of individual and if the gain is taken after 1 year from the date of investment, the gain is long term in nature and tax is to be paid at flat rate of 10% or 20% of gain after indexation.

Can it be taken as immediate income?
Answer to this is difficult to answer, any product can be suitable if suits to your situation only. Any investment product can be compared with a train taking you to a destination.

There are n numbers of train but your train depends upon the destination. Similarly you should carefully chose this product because only equity part of the fund is set to give you better returns with volatility.

Investment Asset Class Rate Return Expense Realize Return Income tax Inflation Your Gain
100000
Dept 80000
Equity 20000
@9% 7200 10% 2% 10%-2% @10% 8% minus 0.80%
@14% 2800 8% 7.20%
Anil Kumar
Anil Kumar
2021-07-12
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Rahat Jahangeer
Rahat Jahangeer
2021-07-12
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Anmol Panday
Anmol Panday
2021-07-12
This is really a mission that Mr. Viplav Majumdar and his team is doing, Because 95% people don't know about this and the rest 5% wealthy people who know about this are not worried about others.
Raj Singh
Raj Singh
2021-07-12
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Vikram Choudhary
Vikram Choudhary
2021-07-12
Planyourworld has helped on financial plan & how to take care of money plan towards untoward incidents in life.
Manish Nagar
Manish Nagar
2021-07-05
I went through the ebook, I haven’t seen that any advisor tells these things to us
Faizul Khan
Faizul Khan
2021-07-05
I needed some more from Viplav, if he could check my things personally. Later I realised he wants us to learn, so I can do it on my own.
Sudhanshu Singh
Sudhanshu Singh
2021-07-05
I never saw a complete package at this cost. I might have easily paid 25k for this
ankush choudhary
ankush choudhary
2021-07-05
I am already getting my passive income, still enrolled, I know I didn’t know anyone who is interested in me, Viplav and his team really helped me
Nevermore
Nevermore
2021-07-05
The entire package is awesome, I am using it I am satisfied.
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