BANKS A.    Five years Bank FDs (Maturity value for Rs 1,00,000/-)

Sl no	Some Selected Banks	Interest Rate ( %)	Quarterly interest (Rs)	Maturity value
				5 years (Rs)	10 years (Rs)
1	IDBI bank	9.50%	2,375	1,57,424	2,47,823
2	State bank of India	9.25%	2,313	1,55,635	2,42,222
3	ICICI bank	8.75%	2,188	1,52,106	2,31,362
4	Bank of India	8.75%	2,188	1,52,106	2,31,362
5	Axis bank	8.50%	2,125	1,50,366	2,26,098

B.    Senior Citizen: Five year Bank FDs (Maturity value for Rs 1,00,000/-)

Sl no	Selected Banks	Interest  (In %)	Quarterly interest (Rs)	Maturity value
				5 years  (Rs)	10 years (Rs)
1	IDBI Bank	10.25%	2,563	1,62,889	2,65,330
2	State bank of india	9.75%	2,438	1,59,229	2,53,539
3	Bank of India	9.75%	2,438	1,59,229	2,53,539
4	Axis Bank	9.50%	2,375	1,57,424	2,47,823
5	ICICI Bank	9.50%	2,375	1,57,424	2,47,823

Taxation:  Investment amount will be allowed as deduction u/s 80C. Interest income from this deposit is taxable as per tax slab. Suitability: The retiree who is in the lower tax slab. Indian Post Office A.    Senior citizen saving scheme

Tenure of the deposit account	5 years + 3 yrs extension
Rate of interest	9 % pa
Interest payments	Quarterly
Taxability	Interest is taxable.
Whether TDS is applicable	Yes.
Maximum investment limit	Rs 15 lakhs/-
Minimum eligible age	60 years (55 years for those who have retired on superannuation or under a voluntary  or special voluntary scheme)
Premature closure/withdrawal	Less than 1 year: SCSS can’t be encashed 1-2 years: you are penalised 1.5% on deposit amount On or after 2 years: you are penalised 1% on the deposit amount.
Modes of holding	Accounts can be held both in single and joint holding modes. Joint holding is allowed only with spouse.
Applicable to NRI, PIO, and HUFs	Not eligible to open account.

Taxation:  Investment amount will be allowed as deduction u/s 80C. Interest income from this deposit is taxable as per tax slab. Suitability: The retiree who is in a lower tax slab and needs quarterly income. B. Monthly income schemes

Maturity	6 years
Interest rate	8% per annum.
Premature closure	a.      Less than 1 year: MIS can’t be encashed. b.      1 – 3 years: You are penalized 2% of deposit. c.       After 3 years: You are penalized 1% of your deposit.
Investment  amount	a.      In case of single account ,Maximum Rs4,50,000/- b.      In case of joint account, Maximum Rs 9,00,000/-
Tax & TDS	Income taxable but no TDS

Taxation:  Tax benefit is not available on deposit amount. Interest income from this deposit is taxable as per tax slab. Suitability: The retiree who is in a lower tax slab and needs monthly income. Mutual Funds A.Balanced schemes

Best balanced schemes	Exp(%)	1 yr return	3rd  yrs return	5th  yrs return
HDFC prudence	1.79	0.95%	32.51%	11.86%
HDFC Balanced	2.05	4.60%	29.51%	11.61%
Birla sunlife 95	2.29	-1.71%	24.99%	10.68%

Taxation:   STCG(Less than 1 year)          : 15% on capital gain LTCG (More than 1 year)      : Tax free Dividend distribution tax is Tax free Suitability: The retiree who wants to higher return by taking moderate risk. B. Debt fund

Selected Debt funds	Exp(%)	1 yr return	3rd yrs return	5th yrs return
Escorts Income plan	2.25	15.33%	9.01%	9.14%
SBI Dynamic Bond	1.60	12.89%	7.61%	4.13%
Birla SL Dynamic Bond Retail	0.88	10.31%	7.89%	9.53%
IDFC SSI medium term	1.20	10.18%	8.76%	8.86%

Taxation:  STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Dividend distribution tax is 14.1625% including surcharge and cess. Suitability: The retiree who want safe return with conservative risk. C. Fixed Maturity Plan (FMP) a. This is a close-ended fund that invests in money market instruments and debt. b. Pre set fixed maturity periods.

Selected Fixed Maturity Plans	Exp(%)	1m return	3m  return	1 yr return
Birla SL FTP Series BV	0.65	0.79%	2.49%	10.16%
HDFC FMP 36M Apr 2010	0.60	1.00%	3.08%	10.30%
Kotak FMP 24 M Series 1	0.05	0.84%	2.43%	10.07%

Taxation: STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Dividend distribution tax is 14.1625% including surcharge and cess. Suitability: The retiree who wants to invest for fixed maturity period with high tax slab. D. MIPS

Selected Monthly Income Plans	Exp (%)	1 yr return	3rd  yrs return	5th yrs return
HDFC MIP Long Term	1.53	5.90%	15.63%	9.86%
Reliance MIP	1.54	7.49%	13.09%	10.35%
Birla MIP II savings 5	1.30	9.57%	8.18%	10.33%

Taxation: STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Dividend distribution tax is 14.1625% including surcharge and cess. Suitability: The retiree who wants to receive periodical income. E. Ultra short term fund

Best Ultra short term fund	Exp (%)	1 yr return	3rd  yrs return	5th  yrs return
IDFC Ultra short term	0.19	9.66%	NA	NA
Canara Robeco floating rate ST	0.37	9.74%	NA	NA
Birla sl floating rate long term	0.54	9.35%	7.89%	8.34%

Taxation: STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Dividend distribution tax is 14.1625% including surcharge and cess. Suitability: Temporary parking of funds (6 months to one year) to time investment later F. Liquid Fund

Best Liquid fund	Exp (%)	1 m return	3 m return	1 yr return
Reliance liquidity	0.35	0.80%	2.35%	9.17%
TATA liquid super HI	0.35	0.80%	2.35%	9.14%
IDFC cash plan C	0.45	0.80%	2.34%	9.16%

  Taxation: STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Dividend distribution tax is 28.325% including surcharge and cess. Suitability: Immediate parking of funds. Life Insurance (Pension/Annuity) LIC and ICICI prudential life were offering this product but now this has been discontinued .New products awaiting IRDA approval. The various annuities options are i. Life annuity ii. Annuity certain for a fixed number of year iii. Joint life annuity iv. Annuity for life with return of purchase price Taxation:  Investment amount will be allowed as deduction u/s 80C. Interest income from this is taxable as per tax slab. Suitability: The retiree who wants periodic income after retirement. Corporate Bonds/NCDs Corporate Bonds/NCDs offers higher returns but has element of credit risk. It is less liquid. Taxation: STCG(Less than 1 years) – Taxable as per slab rate LTCG (More than 1 years) – 10% without indexation and 20% with indexation Suitability: The retiree who wants to receive higher income by taking risk. Reverse Mortgage

1. Age is 60 years for males and 58 for females.
2. Maximum loan= 60% of the property value.
3. Minimum term is 10 years and Maximum term is 15 years but some of the banks give up to 20 years as well.
4. Payment options are monthly, quarterly, annually or lump sum.
5. Revaluation of the property is done every five years.
6. Cash inflows are not taxable.

Taxation: Periodical Income is not taxable Suitability: If a retiree is not able to earn and does not have any other financial assets except residential property. Reverse mortgage is a good option for him.

 Comparison

Sl no	Investments	Interest rate	80C deduction	Interest/ Income	Maturity value
1	Five year bank deposits	9-10% pa	Yes	Taxable	Exempt
2	Senior citizen saving scheme	9% pa	Yes	Allowed for deduction	Taxable
3	Post office monthly income scheme	8%	No	Taxable as per slab rate	Taxable only in that year interest portion
4	Balance fund	See above	No	Tax free	STCG= 15% on capital gain LTCG= Tax free
5	All Debt fund (Debt fund, MIP, FMP, Ultra short term fund)			Tax free subject to 12.5% DDT*	**STCG=As per slab rate   ***LTCG=10% without indexation or 20% with indexation
6	Liquid fund			Tax free subject to 25% DDT*
7	Annuities	5%-8%	Yes	Taxable	No maturity value
8	Non-convertible debentures	Relate to market rate	No	Taxable as per tax slab	Only last year’s  interest portion

* Dividend distribution tax **Short term capital gain ***Long term capital gain All the above three are subject to 10% surcharge +3% Higher education cess   The longetivity of both male and female are rising every decade. The breakdown of joint family system, need for better health care at old age and rising cost of living have thrown serious challenges to retirement planning. A SEBI registered investment adviser or a fee only certified financial planner will help you in designing a retirement road-map. This will definitely help you to enjoy Golden days of your life peacefully.