Just retired? Find the best places to invest your savings
Published on Mon, Oct 10, 2005 at 11:53 | Source : Moneycontrol.com
Updated at Wed, Sep 05, 2007 at 16:14
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Just retired? Find the best places to invest your savings
If you're a retiree looking for secure and consistent returns, here's a guide that can help you.
|
Instrument |
Interest rate |
Tax impact |
Lock-in |
To meet liquidity |
|
Savings Account |
3% |
Interest is taxable |
No lock-in |
|
Routine expenses |
|
Senior Citizens Saving Scheme |
9% |
Interest is taxable |
Minimum 5 years |
|
Post office MIS |
8% |
Interest is taxable |
Minimum 6 years |
|
Mutual Fund MIP |
Varies |
-Dividend is tax-free
-Short term capital gains tax at marginal rate of tax
- Long term capital gains tax @ 20% |
No lock-in |
|
Annuity from LIC |
6.5% onwards |
Annuity is taxable |
Minimum 5 years |
|
For medical needs |
|
Mediclaim insurance |
NA |
Claims not taxable |
NA |
|
Floating rate funds |
|
Same as Mutual Fund MIS |
No lock-in |
For long-term needs |
|
Bank Fixed Deposits |
5-6% |
Interest is taxable |
1 year onwards |
|
Infrastructure Bonds |
5-6% |
Interest is taxable |
3 year onwards |
|
National Saving Certificate |
8% |
Interest is taxable |
6 years |
|
Equity mutual funds |
Over long term 15-18% |
-Dividend is tax-free
-Short term capital gains tax @ 10%
- No long term capital gains tax
- Securities Transaction tax applicable |
No lock-in |
(Note that all recommendations are keeping in mind current tax laws. These are subject to change in the future finance bills)
by Deepa Venkatraghvan
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