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3 Best Mutual Funds For Retirement Planning


Besides other safe avenues that prove efficient and profitable in the long run such as EPF, PPF, NPS investors increasingly are lapping up mutual funds via the SIP route that help to meet long term retirement planning needs. Typically, these mutual funds are retirement led or retirement oriented mutual fund schemes that offer a mix of both debt and equity and have a lock-in of 5 years or till the retirement age, whichever is earlier.

3 Best Mutual Funds For Retirement Planning

Though as per experts here it is to be very well made clear that when you invest for a longer-term say spanning some decades, none can be sure of a scheme as how far can it be rewarding and basis the scheme's some of the parameters such as Sharpe Ratio etc. you can only know of the past and cannot predict with certainty its future performance.

So, as a prudent investor you should take a call by investing in schemes that have a consistent track record and keep tracking it on a time to time basis and make asset allocation your broader criteria for investment instead of fund allocation.

How to decide how much corpus you would need at the time of retirement?

Ideally one should never pick a random figure to say I need Rs. 5 crore as and when I retire, the figure should be such that it factors all such aspects such as:

i. Inflation
ii. Time value of money
iii. Taxes

So considering the sum that you would need then, you can discount for the inflation number which is probably 6% and basis this you can arrive at real value of money that would need in say 10 or 20 years. Notably Rs. 1 crore now would be just 1/3 rd in value after 20 years.

How to choose best SIP for retirement?

Now when you have arrived at some realistic value for your future retirement goal you need to make the right choice. And for this you need to delve over these points intelligently:
1. Need to know your risk profile aptly
2. Also, the right time horizon for which investment is being parked into
3. Look for mutual funds that come with low cost or expense ratio
4. Not put your entire corpus into just one investment vehicle say typically retirement mutual funds.


Here we suggest 5 such schemes for investors who are willing to take mutual funds route and have low to moderate risk appetite. Typically these investors are nearing their retirement in 5-10 years, so have an investment period of typically this duration only.

Best Mutual funds for retirement planning

1. SBI Bluechip fund (Growth):

It is a CRISIL 3-star rated fund from the large-cap fund category. NAV of the fund as on February 24, 2020, is Rs. 40.77. Expense ratio is 1.66%. You can start a SIP in the fund for as less as Rs. 500 and for the one-time investment you would need Rs. 5000. Top holdings of the fund include HDFC Bank, ICICI Bank, L&T, ITC, Nestle etc.

Scheme name3-month return6-month return1-year3-year5-year
SBI Bluechip fund (Growth)0.810.916.78.77.8

The scheme for a five-year duration with an investment of Rs. 1000 per month has provided an annualized yield of 8.52% returning an investor a total sum of Rs. 74388.53.

This should typically be banked upon if you have an investment horizon of at least 3-4 years.

2. Canara Robeca Bluechip Equity Fund- Regular (Growth plan):

This is a CRISIL 5-star rated fund and can be highly rewarding with based on its past performance. The expense ratio of the fund is 2.47% and NAV as on February 24 is Rs. 28. Top holdings of its portfolio include HDFC Bank, ICICI Bank, RIL, Infosys, HDFC etc.
SIP in the fund can be started for a minimum of Rs. 1000 while for the one-time investment you would need Rs. 5000.

Scheme name3-month return6-month return1-year3-year5-year
Canara Robeca Bluechip Equity Fund- (Growth plan)6.5118.6324.2814.02-

In contrast to the category average return of just 13.06%, the scheme has delivered 21.5% return in a one-year period.

Also, if SIP route is taken in the fund then in the 5-year period the fund offered an annualized yield of 13.25%.

3. Kotak Standard Multicap fund:

It is a CRISIL 4-star rated fund and
NAV of the fund as on February 20, 2020, is Rs. 38.262. The expense ratio of the fund is 1.65%. Top holdings of the fund are ICICI Bank, HDFC Bank, RIL, Axis Bank etc.

Scheme name3-month return6-month return1-year3-year5-year
Kotak Standard Multicap fund2.9512.9718.8711.40-

The scheme with multi-caps shall be suited for investors willing to take the slightly higher risk at the cost of high returns.

With investment worth Rs. 1000 per month in the funds' SIP, the 5-year annualized yield is at 11.82%.


Notably, as discussed above if you have very less knowledge on mutual funds and fail to track the markets, you shall be better off by investing in retirement oriented mutual funds that provide a combination of debt and equity but with tax treatment similar to hybrid funds fail to provide returns at par with equity funds that indeed offer far better returns.

The data is aggregated from moneycontrol site as on February 25, 2020

Mutual funds are subject to market risks and potential investors are suggested to read all the offer documents beforehand to have an insight into the finer print of the offering.


The article is not a solicitation to buy, sell in securities mentioned in the article. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and the author do not accept culpability for losses and/or damages arising based on information in this article.

About the author:

Roshni Agarwal has been covering personal finance and investment planning for close to 5 years. She has a degree in MBA, Finance and writes on Mutual Funds, Stock Markets and Currency markets.

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