Mutual funds: If you are planning to invest, then you can double your money in 5 years by investing in retirement mutual funds. Because this retirement mutual fund is giving more than 15% annual return to the customers in 5 years.
As per the website of Association of Mutual Funds in India (AMFI), HDFC Retirement Savings Fund – Equity Plan has given annualized return of 15.36% under Direct Plan over 5 years. Calculations show that if a person had invested Rs 15 lakh in the direct plan of this scheme 5 years back, it would have grown to around Rs 30.6 lakh.
The scheme has given a return of 13.36% in 5 years under the regular plan, which could have converted a lump sum investment of Rs.15 lakhs into approximately Rs.28 lakhs during this period. In comparison, Rs 15 lakh invested in SCSS scheme 5 years ago by a senior citizen would have grown to approximately Rs 21.5 lakh at 8.7% interest rate available between 01-10-2018 and 31-12-2018 (Rs 15).
For investments made between 01-01-2018 and 30-09-2018 at the 8.3% interest rate available, the total corpus would have grown to Rs.21.2 Lakhs (Rs.15 Lakhs principal + Rs.6.2 Lakhs interest). SCSS interest is payable on a quarterly basis. This means that a fund of Rs 21.5 lakh or Rs 21.2 lakh would have been possible. However, both SCSS and retirement mutual funds serve different purposes.
Mutual funds come with risks
SCSS is meant for guaranteed income to support post-retirement life and only senior citizens can invest in this scheme. On the other hand, retirement mutual funds come with market risk and aim to help investors accumulate funds for retirement planning. Here is a look at 5 key points about HDFC Retirement Savings Fund – Equity Plan that you need to know.
Know 5 important points
- It is an open-ended retirement solution plan with a lock-in period of 5 years or till the age of retirement (whichever is earlier).
- It is also a tax saving pension scheme which invests minimum 80% of the portfolio in equity and equity related.
- The scheme was launched on February 25, 2016 and as per the information given on the website of the fund, the AUM value of the scheme as on April 30, 2023 was Rs.2964.34 Crore.
- The scheme tracks the Nifty 500 Total Return Index and its investment objective is to provide long term income by investing in a mix of equity and debt instruments to help investors meet their retirement objectives There is no assurance that the investment objective of the scheme will be achieved.
- If any person who is a resident of India and whose age is more than 18 years, can invest in this retirement mutual fund scheme. Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs) / Overseas Citizens of India (OCIs) can also invest in this scheme on Repatriation basis or Non-Repatriation basis.
These funds gave higher returns
- The Direct Plan of Quant Mid Cap Fund has given a return of 20.45% while the Regular Plan has given a return of 18.47% in 5 years. The scheme tracks NIFTY Midcap 150 Total Return Index, which has given 13.75% return in 5 years.
- The Direct Plan of PGIM India Midcap Opportunities Fund has given a return of 18.97% while the Regular Plan has given a return of 17.00% in 5 years. The scheme tracks NIFTY Midcap 150 Total Return Index, which has given 13.75% return in 5 years.
- The Direct Plan of Motilal Oswal Midcap Fund has given a return of 16.91% while the Regular Plan has given a return of 15.51% in 5 years. The scheme tracks NIFTY Midcap 150 Total Return Index, which has given 13.75% return in 5 years.
- The Direct Plan of Axis Midcap Fund has given a return of 16.19% while the Regular Plan has given a return of 14.71% in 5 years. The scheme tracks S&P BSE 150 Midcap Total Return Index, which has given a 5 year return of 13.01%.
These best performing Mid Cap Mutual Fund schemes have given annualized returns of over 15% in 5 years ending May 15, 2023.
