Overview

Those who’re looking for a steady income invest in monthly income plan. MIP or monthly income plan is a scheme of mutual funds where most of the money is invested in debt instruments. Some of the aggressive monthly income plans invest 16-30% in the equity and the rest in debt.

What is the process of investing in mutual funds

There are majorly 2 types of monthly income plans:

  1. Aggressive monthly income plan
  2. Conservative monthly income plan
Aggressive monthly income plan1st annualized return3rd annualized return5th annualized returnLaunch date
Birla Sun Life MIP II Wealth 2516.24%17.42%13.95%22nd May 2004
ICICI Pru MIP25-Regular Plan11.43%14.36%12.25%30th March 2004
HDFC MIP-Long term Plan12.48%15.09%11.76%26th December 2003
Kotak MIP regular plan13.75%13.81%11.60%29th December 2003
UTI MIS Adv10%13.65%11.56%16th December 2003

Keep reading on Best mutual funds schemes to consider investing in 2019

Conservative monthly Income plan1st annualized return3rd annualized return5th annualized returnLaunch date
SBI Magnum MIP12.67%13.11%11.60%24th March 2001
Birla Sun Life MIP II saving 512.71%12.95%11.17%22nd May 2004
SBI Magnum MIP floater10.88%12.80%11.41%21st December 2005
ICICI Pru MIP-regular plan9.68%12.22%10.67%10th November 2000
Franklin MIP10.48%13.57% 11.60%28th September 2000

Comparison among different savings schemes

CriteriaMIPFDPost Office monthly schemeFixed maturity plan
Average return rate6-12%7-8%8%9-10%
Risk involvedLow riskNoNoLow risk
Assured monthly incomeNoAssuredAssuredNot available
TDSNoYesNoNo
ComplexityModerateEasyEasyModerate
Max limitNo limitNo limit4.5 lakh for single and 9 lakh for the joint accountNo limit
Early withdrawal penalty1%1% less interest will be paid2% before 3 years.
1% after 3 years.
0-2.5%
Tax on returnBefore 1 year, as per your slab.
After 1 year, 10-20% with indexation
As per your tax slabAs per your tax slabBefore 1 year, as per your slab.
After 1 year, 10-20% with indexation

7 best Monthly Income Plans

1. Aditya Birla Sun Life Regular Savings Fund monthly income plan

Year of inception

This scheme was launched in the year 2004.

Category

Heavily debt oriented monthly income plan. It invests 70-80% of the pool money in debt and the rest is invested in equity and equity related instruments.

Investment plan

Individuals have the option of starting small with an investment worth Rs. 1,000 and consecutive payments of the same amount could be submitted in the SIP plan. Investors have the option to give 6 post-dated cheques for investing in the systematic investment plan.

Returns

This scheme has generated a return of -3.02 percent in the last year. In addition to this, this fund has given returns of almost 11.37 percent in the last five years.

The assets under management are about Rs 2,572 crores.

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2. Franklin India Debt Hybrid Fund monthly income plan

Year of inception

This scheme was launched in the year 2000.

Category

Hybrid debt oriented conservative monthly income plan. There is a 1 percent exit load for redemption within 365 days.

Investment plan

Individuals have the option of starting small with an investment worth Rs. 1,000 and consecutive payments of Rs. 500 could be submitted in the SIP plan.

Return

The fund has given an average return of 9.56 percent in the last 5 years. The NAV under the growth plan is Rs 54.09, while the dividend plan has NAV of Rs 12.68.

Portfolio

Stocks like Bharti Airtel, HDFC Bank, Axis Bank, and State Bank of India comes under the portfolio of this scheme.

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3. ICICI Prudential Regular Savings Fund monthly income plan

Year of inception

ICICI Prudential regular savings fund was launched in 2004

Exposure

The savings fund has exposure to 7.61% GOI 2030 and 7.88% government of India security.

Returns

This monthly income plan scheme has given a return of 10.01% since its launch. Previous three-year return of the fund has been close to 8.24%.

Investment plan

Individuals have to option to start investing in the fund with a sum of Rs 5,000.

Portfolio

The portfolio of the fund consists of stocks like Motherson Sumi, Maruti Suzuki, HDFC Bank, TVS Motors.

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4. HDFC Hybrid Debt Fund monthly income plan

Category 

Hybrid debt oriented aggressive monthly income plan

Year of inception

This was launched in 2003.

Exposure

There is heavy exposure to government securities and bonds.

Returns

The average return is 10.39% on an average for the last 5 years. This fund was launched by the HDFC in 2003 and has given a return of 10.31% since its inception.

Investment plan

Individuals have the option to start the investment with the amount of Rs. 5,000 and the SIP worth of Rs.500 each.

Portfolio

The investment is done in the stocks like ICICI Bank, L&T, State Bank of India, Infosys, etc.

5. ICICI Prudential Ultra Short Fund

Category

Hybrid debt oriented conservative plan i.e. bulk of the money is invested in debt oriented schemes.

Year of inception

This scheme was launched in the year 2011.

Exposure

The fund also has exposure to 7.61% GOI 2030 and 7.88% government of India security.

Returns

Monthly income plan invested in this scheme has generated a return of 6.46% in the last 5 years. Also, the dividend that is payable every quarterly which investors could opt for, and the net asset value of the same is Rs 10.0

Portfolio

The money is invested in the stocks of Reliance Industries, Larsen and Toubro, Tata Steel and Axis Bank.

Best SIP to Invest in Mutual Fund

6. UTI Regular Savings Fund-Regular monthly income Plan

Year of inception

This scheme was launched in 2003

Exposure

This scheme is a debt oriented conservative and has exposure to the government of India securities.

Returns

This scheme of MIP has given a return of 9.67%  since its launch way back in 2003. Last 3 years return of this fund is approximately 7.17%.

Investment plan

Individuals have the option to start investing in the fund with a sum of Rs 5,000.

Portfolio

The money is invested in the stocks of Bajaj Finance, IndusInd Bank, Yes Bank, and Infosys.

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7. Reliance Hybrid Bond Fund monthly income plan

Year of inception

This scheme was launched in 2003.

Returns

The money invested in this fund has given a return of 11.21 in the last 10 years. Last three-year returns are approximately 6.48 %.

Investment plan

Individuals have the option to start investing in the fund with a sum of Rs 5,000.

Portfolio

The fund consist of stocks like HDFC Bank, and Reliance Industries.

Exposure

This scheme has a debt exposure like the 8.17% government of India 2044.

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