Reinvesting your accumulated funds post-retirement for cash flows will be easy if you know the safe financial instruments you can rely on. Any mistake in this phase of life could be irrevocable, assuming you have no other major income, and hence, you must carefully plan where to invest.

Picking the right financial products based on your needs, lifestyle, health, and risk appetite could be challenging if you aren’t familiar with them. For example, whether you should opt for mutual funds, guaranteed income instruments, or both, balancing risk and reward expectations.

Here are some investment instruments for seniors post-retirement.

Fixed Deposits

The fixed deposit (FDs) plans have no age limit, short-term and offer a prefixed guaranteed return, which is typically higher for senior citizens than the rest of the public. Senior citizens can choose a tenure and an amount of their choice for a fixed deposit. Moreover, one can break the FD if need arise in an emergency. Banks also offer loans against FDs. So, it could be a useful investment instrument for cash flows after retirement.

Also Read: What Is A Sanchaya Tax? All You Need To Know

Post Office Time Deposits

Post office time deposits are short-term investments between one and five years. Seniors can earn interest income by investing in time deposits. Term deposits offer rates based on the selected investing period. For instance, a five-year lock-in will yield 7.5 per cent returns, compared to 6.9 per cent for a year. Most post office schemes provide assured earnings.

Mutual Funds

Mutual funds offer various options, from balanced advantage funds to conservative hybrid funds with varied risk profiles. Senior citizens can choose a plan based on their risk-taking ability. Mutual funds usually offer higher returns than guaranteed return plans like FDs and government securities. However, they must evaluate the product features before investing. Conservative hybrid funds generally carry less risk and could offer higher returns than FDs. Mutual funds also provide the flexibility of choosing an investment horizon and contributions.

Also Read: UP Launches ‘Kalyan Sathi’ Initiative To Bolster Delivery Of Pensions To Senior Citizens

National Savings Certificate

NSC has a five-year lock-in, with no upper age limit for investments. It offers an annual interest of 7.7 per cent with compounding benefits. Once can invest a minimum of Rs 100, but there is no maximum limit. Once can purchase it from any post office by submitting the relevant know-your-customer documents.  It also can be used as a collateral for loan. NSC investments attract tax savings of up to Rs. 1.5 lakh yearly under Section 80C of the Income Tax Act.