2. Mutual Fund dividends

A mutual fund what a company pools investors' money to make multiple types of investments, known as the portfolio. Stocks, bonds, and money market funds are all examples of the types of investments that may make up a mutual fund. Many mutual funds also have an annual dividend-payout option.

This may come handy in bear market conditions. However, MF dividends are not assured. Moreover, when a mutual fund announces a dividend of say 2, its Net Asset Value will fall by the same amount the next day.

3. Systematic Withdrawal Plan

Opting for a systematic withdrawal plan reduces the risk of irregular cash flow. Even when the scheme is making losses, it will pay the amount opted for by the investor by digging into the principal, if needed.

Also there are many mutual funds that allow a Systematic Withdrawal Plan option. Under this scheme, a fixed amount of MF units will be sold on a particular day every month or quarter. This is the reverse mode of Systematic Investment Plan. However, it is better to opt for this at least a year after purchasing the funds to avoid any exit fees.