Want to Invest about 40 Lac in order to generate Regular Monthly Income to meet Household expenses for my family, in case of job loss or layoff.
Could you suggest various options or combinations available in order to achieve this goal?
At present, I am using bank FD’s.
Sachin-In that case, you can use Arbitrage Funds.
Could you advise how can i invest in arbitage funds and which are the best arbitage funds
I can’t name anyone. But you can short list using the portals like valueresearch.
Sachin-Your planning is good. But I am unable to understand whether you need this income stream immediately or you are planning to generate income from this accumulated corpus in case of worst financial situation (like layoff)?
If you are currently working and no longer in need of monthly income stream from this income means you can keep it aside as an emergency fund. But keeping aside such huge cash for emergency fund is not good. The ideal emergency fund must be around 6-12 months of household expenses.
However, if you are already in financial trouble and in need of income stream from this amount then you have to invest. This again depends on for how long you need this cash flow.
Without knowing your exact requirement, it is hard for me to guide.
Yes…Basically as my wife is quitting her job ,i want to create a monthly flow of income for her and also as a source in case i am layed off or an early retirement.Also for a safe investement so that i dont use this cash to create additional liabilites and impulsive spending.
Hence Tenure of Investment is infinite.
Sachin-If you don’t want to take the risk then I suggest to go for POMIS. Apart from that, I feel uncomfortable to suggest Mutual Fund MIS Schemes as they may or may not provide constant monthly cash flow and also taxation is an issue.
Want to know about the Mutual Fund MIS schemes.Please share the details about it and the best options available at present.Thanks
Sachin-MF MIS have some equity exposure (20% to 30%) and treated like debt funds. Taxation also same. But do remember that they are not bound to give you monthly income. If there is any surplus then they can give you. Shortly, I will write about the same in detail.
Thanks for the reply.
Might sound silly…but what is POMIS ?
Kindly share some information about.
Yes, it is Post Office scheme. You said guaranteed and that too using emergency fund. Hence, I recommended this safe product to you.
Is it Post office Monthly Income scheme.
Can get some details about it.
How safe it is,returns,Tax implication etc
It is taxable income for you.
If planning to generate income from this accumulated corpus in case of worst financial situation (like layoff)? What would suggest as a financial plan for 40 lac sum.
It depends on many parameters like whether emergencies are met by you or not, how long you want and other your investments. Without knowing much, it is hard for me to suggest blindly.