For retirement investments in a balanced fund, should I go for dividend plan or growth plan?
- Dr Rohini Neginhal
It is not clear from your query if you are already retired or are looking to make investments towards retirement. If you are investing for future retirement, it is best to go for the Growth option. This will ensure that your fund's returns make the most of compounding. Dividend payouts, if you receive them in your hands, may get spent or reinvested at low rates. If you are already retired, you should make the choice based on your financial needs. A balanced fund given its equity component cannot be relied on for monthly or annual income. But if you need periodic payouts from your investment, you can go for dividend option. Else, growth option is the best way to maximize the return on your investments.
This article was originally published on July 13, 2015.
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