How do I best invest Rs 1.50 lakh to receive a passive income monthly without investing in bank savings schemes?

passive income monthly without investing

Suppose you have Rs 1.50 lakhs in your hand. How would you invest the money to earn a monthly income? The most common answer to this question would be, ‘It’s simple. Deposit the money in a bank FD and get monthly interest.’ What would be your response if I asked you how would you earn a monthly income passively without investing in a bank savings account?

Let us see the different ways to earn passive income without doing anything.

With Money Club You Can Earn Around 10-20% Return On Your Investment 

  • A

    Invest in a chit fund:

    Instead of investing the entire Rs 1.50 lakh in a lump sum, you can divide it into ten packets of Rs 15,000 each. Choose an ideal chit fund platform like Money Club. Become a registered member and select a chit fund investment of Rs 15,000 for ten months. Money Club matches you with similar investors. Then, you get an option to bid for the pooled money. You can bid if you need the money. Otherwise, you can relax and enjoy the fun. Let other people bid for the pooled money, and you get the interest amount as your monthly share without doing anything. You can be the last bidder in the tenth month and collect your investment back.

  • B

    Invest in mutual funds:

    Select a reputed mutual fund and invest your Rs 1.50 lakhs in it. As mutual funds have a fund manager, you do not have to break your head researching for the best investment opportunities. The fund manager works hard for you. If you opt for monthly returns, you get the income credited to your bank account every month. Thus, you earn passive income without doing any activity. However, mutual funds have their risk factor. Investments in mutual funds depend on market risks. However, choosing a reputed mutual fund manager ensures a decent return. Of course, you do not earn as much as you would have in a chit fund investment. But the income would be more than the bank interest you get on the investment..

  • C

    Invest in P2P lending platforms:

    P2P lending is an emerging concept in India. This concept works by bringing borrowers and lenders on a single platform. The investors earn by lending money to needy borrowers. On the other hand, borrowers get easy loans from investors on mutually agreeable repayment terms.
    Usually, borrowers in urgent need of money who cannot raise it from banks and financial institutions approach the P2P lending platforms to finance their requirements. Similarly, investors looking to earn a better ROI look toward the P2P platforms to make a decent income.

Today, you have P2P platforms like LenDenClub and CredMint that offer attractive investment options. LenDenClub provides a unique ‘Auto Invest’ program where the platform automatically invests surplus funds on the forum. For example, they distribute Rs 1 lakh amongst more than 100 borrowers to reduce the default risk. The concept is that even if ten people default on the repayment, the investment still gains because of the prompt repayment by the 90 other borrowers. So, a P2P lending platform is an excellent avenue to make a decent income from investment.

Trends today show that the net returns on investment in the P2P platform are around 15% to 20%, even after accounting for the defaults.

Which is the best investment opportunity of the three?

We have discussed three passive income-generating schemes in the above paragraphs. Let us understand the best option out of the three.
  • Chit Fund – Money Club Chit Fund platform generates an average ROI of around 20% to 21%, based on recent performances. The funds are managed by professionals who choose their members after conducting strict verification checks.
  • Mutual Funds – Mutual fund investments depend significantly on market trends. They are excellent investments when you have a bull run in the market. But, the market frequently has bear runs that can drain your assets.
  • P2P Lending Platforms – The P2P lending platforms work online. Records show the top platforms generating good ROI, but the default risk is always present. So, you can earn decent ROI if you park your funds with reputed platforms. Otherwise, the investments can be risky.

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Final Thoughts

The analysis shows that chit funds are the best way to earn monthly income on investment of Rs 1.50 lakhs without any activity.