Monthly Income Scheme (MIS)

Monthly income schemes are run by both banks and post offices. These schemes provide a regular income in the form of a monthly interest. These schemes offer a slightly higher interest rate to senior citizens. It's a very useful investment option for senior citizens with a taxable income of less than 2, 50,000. It's attractive for the monthly income it generates and the high interest rate.

Mutual Fund Monthly Income Plans (MIP)

Mutual fund MIPs invest in both debt and equities with an aim to provide a regular income. These have the potential of high return on investment as they invest part of the principal sum in stocks. But these attract as much tax as debt funds as the total investment in stocks is less than 65 percent. Hence, it offers 3 advantages: a healthy return on investment, a regular income and reduced tax.

Insurance Annuity Plans

Under insurance annuity plan, you have to pay a lump sum to the insurer, in exchange of which the insurer commits to provide you with a fixed income for the rest of your life. This way you will get rid of the burden of generating a regular income in your old days till the end of your life.

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