There are very simple and very important questions to ask like what are the best investment options for senior citizens? Where should they deposit their hard-earned money? Well, for senior citizens the most common replies for those questions are bank FD stands for fixed deposits, RD stands for recurring deposits, SCSS stands for Senior Citizens' Savings Scheme, Life Insurance Premiums, etc. But apart from these they also invest in mutual funds.
What industry experts believe that investing in a mix of gold, equity, and debt mutual funds should be a good way to earn better returns.
Mutual funds are a very reasonable tool for senior citizens to diversify investment risks, they provide liquidity while still providing good inflation-adjusted returns over the long term., In senior citizens' portfolios, there should be an optimal mix of fixed income securities, gold, and equity.
They can also invest in post office schemes for senior citizens to get fixed returns, a mutual fund is the best way for equity exposure. It provides inflation-adjusted market-linked returns that helps investor with lesser volatility than individual stocks.
After ensuring contingency funds and cash requirements for five years of expenses in fixed income securities and debt mutual funds; equity mutual funds should be the most crucial portion of senior citizen's portfolios. In this way, they will ensure inflation-adjusted returns over the long term during retired life.
They should focus on their required asset allocation and once having done that, consider mutual fund as one of the options. Mutual funds do offer certain benefits viz. SWP is an easy way of transaction, schemes are a combination of different asset classes - hybrid funds, easy liquidity, etc.
Those who do not have enough knowledge, skills, ability, or time to manage their own money should consider taking advice from experts and take advantage of mutual funds, including the senior citizens.