Best Mutual Funds for Retirement

Retirement plans can be tedious, especially with investment options available in the market. While searching for the best retirement plan in India, you may come across the best mutual funds for retirement. A retirement fund provides a regular income after attaining a certain age can also be called a mutual fund pension plan or pension mutual funds. Depending on your finances, you can choose between a SIP (Systematic Investment Plan) and a lump sum mode to invest. Let us read further to learn more about the good mutual funds for retirement in detail.

List of Best Mutual Funds for Retirement in 2024

Below is the list of best mutual funds for retirement:

Overview of Best Mutual Funds for Retirement in 2024

Below is the overview of the good mutual funds for retirement in detail:

1. ICICI Prudential Retirement Fund - Pure Equity Plan Direct-Growth

As of Nov 7, 2024, the NAV of ICICI Prudential Retirement Fund - Pure Equity Plan - Direct Plan is ₹33.5900.

Bharti Airtel, Interglobe Aviation, Tech Mahindra, Ambuja Cements, Ultratech Cement and more are the top holdings of ICICI Prudential Retirement Fund - Pure Equity Plan Direct – Growth.

ICICI Prudential Retirement Fund - Pure Equity Plan Direct – Growth had invested 91.77% in Equity and 8.23% in Cash & Cash Eq. with AUM of ₹1,035 Cr as of 30 Sept 2024.

2. HDFC Retirement Savings Fund Equity Plan Direct-Growth

As of Nov 7, 2024, the NAV of HDFC Retirement Savings Fund Equity Plan - Direct Plan is ₹56.9490.

HDFC Bank, ICICI Bank, Axis Bank, Infosys, Bharti Airtel, and more are the top holdings of HDFC Retirement Savings Fund Equity Plan - Direct Plan.

HDFC Retirement Savings Fund Equity Plan - Direct Plan had invested 91.77% in Equity and 8.23% in Cash & Cash Eq. with AUM of ₹6,168 Cr as of 30 Sept 2024.

3. Nippon India Retirement Fund - Wealth Creation Scheme Direct-Growth

As of Nov 7, 2024, the NAV of Nippon India Retirement Fund - Wealth Creation Scheme - Direct Plan is ₹32.6184.

HDFC Bank, ICICI Bank, Tata Consultancy, Infosys, Reliance Ind and more are the top holding of Nippon India Retirement Fund - Wealth Creation Scheme - Direct Plan.

Nippon India Retirement Fund - Wealth Creation Scheme - Direct Plan had invested 99.42% in Equity, 0.58% in Cash & Cash Eq., and 0% in Debt with AUM of ₹3,501 Cr as of 30 Sept 2024.

4. Tata Retirement Savings Fund Progressive Plan Direct-Growth

As of Nov 7, 2024, the NAV of Tata Retirement Savings Fund - Progressive Plan - Direct Plan is ₹79.5375.

HDFC Bank, ITC, Zomato, Reliance Ind, Solar, and more are the top holdings of Tata Retirement Savings Fund - Progressive Plan - Direct Plan.

Tata Retirement Savings Fund - Progressive Plan - Direct Plan had invested 93.65% in Equity and 6.35% in Cash & Cash Eq. with AUM of ₹2,182 Cr as of 30 Sept 2024.

5. Aditya Birla Sun Life Retirement Fund - The 30s Plan Direct-Growth

As of Nov 7, 2024, the NAV of Aditya Birla Sun Life Retirement Fund - The 30s Plan - Direct Plan is ₹21.4920.

ICICI Bank, HDFC Bank, Infosys, Reliance Ind, Larsen & Toubro, and more are the top holdings of Aditya Birla Sun Life Retirement Fund - The 30s Plan - Direct Plan.

Aditya Birla Sun Life Retirement Fund - The 30s Plan - Direct Plan had invested 97.16% in Equity, 2.53% in Cash & Cash Eq., and 0.31% in Debt with AUM of ₹423 Cr as of 30 Sept 2024.

6. Tata Retirement Savings Fund Moderate Plan Direct-Growth

As of Nov 7, 2024, the NAV of Tata Retirement Savings Fund - Moderate Plan - Direct Plan is ₹75.6089.

GOI Sec 7.38 20/06/2027, GOI Sec 7.27 08/04/2026, HDFC Bank Ltd SR US002 Debenture 7.80 03/05/2033, Mindspace Business Parks REIT Debenture 6.35 31/12/2024, GOI Sec 6.79 26/12/2029, and more are the top holding of Tata Retirement Savings Fund - Moderate Plan - Direct Plan.

Tata Retirement Savings Fund - Moderate Plan - Direct Plan had invested 79% in Equity, 12.66% in Cash & Cash Eq., and 8.34% in Debt with AUM of ₹2,233 Cr as of 30 Sept 2024.

What are the factors to consider before investing in the best mutual funds for retirement?

Before investing in the best mutual funds for retirement, you must consider the below-mentioned factors:

• Risk: While investing in a retirement fund, you must understand the risk level and volatility involved in the type of retirement fund.  
• Duration: Generally, the retirement fund is considered for a long duration which demands aggressive investment strategies. On the other hand, conservative strategies are used for shorter duration.
• Payout mode: Based on your financial goal, you have the freedom to choose the payout mode between lump sum or SIP at the end of the investment period.
• Tax impact:  Returns from retirement plans are taxable upon redemption.You must choose an investment option with tax benefits considering tax rates on capital gains.
• Past performance: Measuring the past performance of the mutual fund that you want to invest is important. You must check the returns on different time periods and compare different mutual funds.

Tax implication on returns from mutual funds for retirement

Under section 80CCC of the Income Tax Act, you can claim a tax deduction of up to ₹1.5 Lakh.

Equity Retirement Fund

• If you withdraw before one year from the date of investment in an equity retirement fund, you have to pay 15% as short-term capital gains.
• If you withdraw after one year from the date of investment in an equity retirement fund, you have to pay 10% as long-term capital gains.

Debt retirement Fund

• If you withdraw before three years from the date of investment in an equity retirement fund, an income tax slab will be applicable.
• If you withdraw after three years from the date of investment in an equity retirement fund, 20% will be applicable after indexation.

Conclusion
Investing in good mutual funds for retirement is a good choice if you are planning to secure your future. While investing you must consider all the factors such as risk involved, duration of the investment, payout mode, tax impact on the returns, and past performance of the mutual funds to choose the best investment plan.