Looking to earn a steady income without taking big risks? Mutual funds with a 5-star rating from Value Research are a smart choice for safe and reliable returns. In 2025, several steady income mutual funds in India scored the highest rating thanks to their consistent performance, lower risk, and investor-friendly features. This guide will help you find the top funds to consider so you and your family can enjoy financial peace of mind.
What are Steady Income Mutual Funds?
Steady Income Mutual Funds are a special type of mutual funds that focus on generating regular and stable income for investors, rather than just aiming for rapid capital growth. These funds invest primarily in debt instruments like government bonds, corporate bonds, and money market securities, which offer fixed interest payments over time. They may also include some equity or dividend-paying stocks to achieve a balance between income and growth.
The main goal of steady income mutual funds is to provide investors with steady payouts through interest and dividends, usually on a monthly, quarterly, or annual basis. They are designed to have a moderate risk profile, meaning they are less volatile than pure equity funds but may carry some level of market risk.
Key features of steady income mutual funds include:
- Focus on generating regular income through interest and dividends.
- Investments mainly in fixed-income securities, which tend to be safer and less volatile.
- Diversified portfolios that reduce risk by spreading investments across different securities.
- Moderate risk level, suitable for investors who want stable returns without high risk.
- Capital preservation is a priority, aiming to protect the original investment while earning consistent returns.
- Suitable for investors looking for predictable income, such as retirees, or those wanting to balance risk in their portfolio.
These funds work by pooling money from many investors and investing in a mix of debt securities and some dividend-paying stocks. The returns come from periodic interest payments and dividends, as well as any capital appreciation from the securities held.
Learn More: Why Indian Investors Are Adding Australian ETFs to Their Portfolios?
List of top 6 steady income Mutual Funds for 2025
| Mutual Fund Name | Category | 5-Year CAGR (%) | Risk Level | Expense Ratio | Key Features |
|---|---|---|---|---|---|
| SBI Magnum Children’s Benefit Savings | Conservative Hybrid | 13.8 | Moderately High | 0.85% | Family goals, long-term returns |
| Edelweiss Equity Savings Fund | Equity Savings | 12.1 | Moderate | 0.60% | Balanced mix, low cost |
| ICICI Prudential Equity Savings | Equity Savings | 10.1 | Moderate | 0.77% | Stable returns, less ups/downs |
| ICICI Prudential Regular Savings | Conservative Hybrid | 10.8 | Moderate | 0.89% | Safe growth, balanced investing |
| Nippon India Conservative Hybrid | Conservative Hybrid | 9.8 | Moderate | 0.70% | Steady income, low risk |
| Parag Parikh Conservative Hybrid | Conservative Hybrid | NA (<5 years) | Moderate | 0.65% | New fund, trusted brand |
Top 6 steady income Mutual Fund: Details and Benefits
#1. SBI Magnum Children’s Benefit Savings
This fund is popular for long-term goals like planning for children’s education. It invests in both equity and debt, aiming for stable returns and safety for investors. The fund is best for parents looking to save money for their children’s future, and its returns have been strong over the last five years.
Features
- Designed for long-term family needs like children’s education or marriage.
- Combines debt and equity to keep your money safer and help it grow over time.
- Known for strong returns, making it a good pick for steady income seekers.
#2. Edelweiss Equity Savings Fund
Edelweiss Equity Savings Fund uses a smart mix of equity, arbitrage, and debt instruments. This helps in getting regular income and also keeps risks under control. Its expense ratio is low, meaning more of your money works for you. It is good for people who want both stability and some growth
Features
- Uses a clever mix of shares, arbitrage, and bonds for reliable returns.
- Has a low expense ratio, so most of your money stays invested.
- Ideal for those who want stable income with some growth.
#3. ICICI Prudential Equity Savings Fund
This fund focuses on giving steady returns by mixing equity and debt, and using arbitrage. It does not have very high volatility, making it suitable for investors who want to avoid big ups and downs. Past returns show good performance for safe wealth growth.
- Blends shares and debt investments for steady growth.
- Uses arbitrage to reduce volatility, so your returns are smoother.
- Good choice if you want regular income and lower market swings.
#4. ICICI Prudential Regular Savings Fund
This is a balanced fund that uses both debt and equity to deliver consistent returns. Investors looking for a combination of safety and growth can consider this fund. It is suitable for all ages, especially those wanting to avoid high risk.
Features
- A balanced fund, mixes debt and equity for safer investing.
- Suits all age groups, especially those who want safety and growth.
- Delivers consistent returns with lower risk than pure equity funds.
#5. Nippon India Conservative Hybrid Fund
This fund invests mostly in debt, with some part in equity. The main goal is to generate steady income for investors and keep risks lower than pure equity funds. The fund has performed well in different market conditions.
Features
- Focuses mainly on debt, with a small share in equity for growth.
- Best for investors who want steady income and low risk.
- Handles market ups and downs better than aggressive funds.
#6. Parag Parikh Conservative Hybrid Fund
Parag Parikh Conservative Hybrid Fund is newer but has quickly built a strong reputation. It also invests in a mix of debt and equity. Though it does not have a 5-year record yet, its recent track looks promising and it has received a 5-star rating.
Features
- One of the newest trusted funds, mixes debt and equity in a smart way.
- Has not completed five years yet, but already earning high marks.
- Backed by a reputable brand, making it promising for steady income.
Conclusion
If you want your money to grow slowly and surely, these six mutual funds are strong options for 2025. Each fund has a 5-star rating from Value Research, meaning experts trust them for safety, returns, and reliability. Check the risk level, expense ratio, and key benefits before investing, and match with your financial goals. Remember, mutual funds can help you build wealth and achieve life goals without worrying about big market changes.
Disclaimer: Mutual fund investments are subject to market risks. Always read all scheme-related documents carefully before investing. You can consult a financial advisor if you need help choosing the best fund for you.
Learn More:
- How to Start Investing in Mutual Funds in India – Step-by-Step Process for Beginners
- Difference Between Mutual Funds and Stocks – Which is Better for Beginners?
- Understanding NAV (Net Asset Value) in Mutual Funds – What It Means and Why It Matters
- Risks Involved in Mutual Fund Investments – Common Risks and How to Manage Them
