Monthly Income Plan

 


A Monthly Income Plan (MIP) is a type of mutual fund strategy that invests primarily in debt and equity securities with a mandate of producing cash flows and preserving capital. An MIP aims to provide a steady stream of income in the form of dividend and interest payments. Therefore, it is typically attractive to retired persons or senior citizens who do not have other substantial sources of monthly income.


Key Takeaways

  • A monthly income plan (MIP) is a category of mutual fund that seeks to generate stable income through dividend and interest cash flows.
  • An MIP will often invest in lower-risk securities, including fixed-income instruments, preferred shares, and dividend stocks.
  • Popular especially in India, MIPs are most suited for retirees who seek stable income rather than capital gains.