Top 3 Best Retirement Funds of 2018 to Build a Better Tomorrow

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Retirement planning is a primary concern of every individual. People seek the best retirement plans, and with the advancement in every field, the traditional methods like NSC, EPF, and PPF have become outdated. Retirement mutual funds are trending because of their multiple benefits, but which one is best for you? Let’s find out here!

Mutual funds have taken good care of every financial need of investors, and the same goes for retirement planning as well. With the surplus returns in the long term, disciplined and comfortable investments through SIP, and monthly income facility, investors can make a robust plan for the post-retirement era of life and do not have to rely on their offsprings to fulfill their financial needs.

Some of the mutual funds that are suitable for retirement planning are described below:

1. Tata Retirement Savings Fund  
   This unique scheme is explicitly designed for retirement planning purpose where all the factors and requirements regarding retirement are taken care of. Tata Retirement Savings Fund aims to gather maximum wealth at the initial stage and delivers more secured returns at the old age. For fulfilling this purpose, it has efficiently divided itself into three parts with a feature of an auto-switch. The progressive plan is available for the investors of age less than 45 years. It invests in a slightly aggressive equity portfolio to stretch the invested amount. The moderate plan, which can be auto-switched or opted for the investors of age 45-60 years, has a moderate risk-oriented portfolio with a mixture of equity and debt instruments. The conservative scheme aims to provide a stable and consistent return without influencing high-risk equity instruments. The majority of debt-oriented plans are automatically switched when the investor reaches the age of 60. The withdrawal can be made via lumpsum or with a systematic withdrawal plan to necessitate the daily needs after retirement. It has performed well in the past and has reduced the post-retirement financial burden of investors.
2. Reliance Retirement Fund - Wealth Creation Scheme
   Reliance Mutual Fund provides a unique scheme to serve the purpose of retirement planning efficiently. It is divided into two schemes which assist different objectives. They are named as Wealth Creation Scheme and Income Generation Scheme. The Reliance Retirement Fund - Wealth Creation Scheme is focused on gathering and enhancing maximum corpus which can be further utilised as a pension. For this, the fund managers invest the majority of the corpus in equity instruments of the diversified category, though sometimes a small proportion (0-20%) is also allocated to debt instruments. The Income Generation Scheme is highly conservative, and hence the portfolio is majorly inclined towards debt instruments. It aims to provide steady and consistent returns for the retirees. It can be switched manually or automatically once the lock-in period of 5 years is completed. It also allows tax benefits of up to Rs 1.5 lakh under section 80C. It was launched in 2015 and hasn’t got enough time to perform in the market. The investment can be made through SIP as well as the lumpsum with a step-up facility, which can be utilised to increase the SIP amount at a pre-defined interval.
3. Franklin India Pension Fund  
   This fund offered by the international AMC, i.e., Franklin Templeton MF also fulfills multiple purposes by investing in a balanced portfolio of equity and debt instruments. Tax benefits under section 80C can be grabbed through this scheme, but the objective behind its inception in 1997 was to reward the investors with a secured and stable corpus as a pension. That’s why the fund charges an exit load of 3% if withdrawal is made before the age of 58. Franklin India Pension Fund has performed decently in the past and has been able to reach its benchmark. The portfolio is slightly oriented towards debt instruments which possess approximately 60% of the corpus with the average maturity of 17 years. The equity allocated corpus is well spread across diversified sectors.

Since the fund described above are incredibly beneficial and varies regarding strategy, every scheme provides different suitability to its investors. To know the details of the schemes in-depth and to check its adequacy according to your risk appetite and investment horizon, connect with the experts working at MySIPonline and reach out for the best investment strategies.