Monthly Income Plan - MIP

DEFINITION of 'Monthly Income Plan - MIP'

A type of investment vehicle that provides a specified monthly payment to the investor. This monthly payment is intended to be a stable form of income and is therefore typically suited for retired persons or senior citizens without other substantial sources of monthly income.

BREAKING DOWN 'Monthly Income Plan - MIP'

A monthly income plan can be thought of as a budget for a retirement income. Rather than reaching retirement and spending your nest egg by making random withdrawals of varying amounts, a monthly income plan can ensure you receive a stable amount of funds each month to spend, which limits the risk of over-spending. In this regard, an MIP is similar in many ways to an annuity.

RELATED TERMS
  1. Monthly Income Preferred Securities ...

    Shares that are an interest in a limited partnership existing ...
  2. Income

    Money that an individual or business receives in exchange for ...
  3. Years Certain Annuity

    An insurance product that pays the holder a monthly income for ...
  4. Retirement Planning

    The process of determining retirement income goals and the actions ...
  5. Investment Income

    Income coming from interest payments, dividends, capital gains ...
  6. Net Investment Income

    Income received from investment assets (before taxes) such as ...
Related Articles
  1. Retirement

    How To Move From Nest Egg To Income?

    Income vs. a nest egg is closely tied to what most of us are ultimately interested in for retirement – maintaining our standard of living and to travel.
  2. Retirement

    3 Ways Retirees Can Generate Income From Investments

    Retirement can last a long time, which means people not only have to save for retirement but see it generate income. Thankfully there’s lots of ways to do that.
  3. Products and Investments

    When to Plan for Retirement Income vs. Savings

    Accumulating a nest egg is the first step in effective retirement planning. The second is making sure you have enough income after retiring.
  4. Retirement

    Ready to Retire? Ask Yourself These 3 Questions

    Can you afford to stop working and step into a comfortable, stress-free retirement? Here are three questions to ask to help you make the decision.
  5. Retirement

    Weave Your Own Retirement Safety Net

    Build savings to support yourself in case pension plans and Social Security fall through.
  6. Saving and Spending

    Is the 80% Retirement Rule Valid for Clients?

    Is the 80% rule of thumb for retirement spending a reasonable one?
  7. Investing Basics

    How To Choose A Retirement Income Fund

    Retirees looking for income can choose retirement income funds. But in order to pick the right one, you have to look at investments and fees.
  8. Retirement

    The Best Way To Build Your Retirement Portfolio

    If you're near retirement or already there, it's time to change your investment goals from growing assets to using them to generate income. Here's how.
  9. Investing

    How to Shift From Saving to Spending in Retirement

    Most people prefer a known monthly payment to the complex decision of investing a lump sum to cover their financial needs during retirement.
  10. Retirement

    Strategies To Build Your Retirement Portfolio

    Retirement indexes are designed to estimate how much an investor would need to have saved today to generate annual income in retirement, starting at 65.
RELATED FAQS
  1. What does a sample plan using the 4% retirement rule look like?

    Discover how the 4% retirement rule can work as part of a plan to achieve increasing retirement income if investments perform ... Read Answer >>
  2. What's the difference between private mortgage insurance (PMI) and mortgage insurance ...

    Private mortgage insurance (PMI) is an insurance policy used in conventional loans that protects lenders from the risk of ... Read Answer >>
  3. Do FHA loans require escrow accounts?

    Understand how FHA mortgages require escrow accounts for property taxes, homeowners insurance and mortgage insurance premiums ... Read Answer >>
  4. What are the best ways to pay less income tax?

    Learn about reducing your income tax burden by contributing to an employer-sponsored retirement plan or IRA, and see what ... Read Answer >>
  5. What is the difference between gross income and earned income?

    Being able to distinguish between earned income and gross income is an important tool in preparing for and filing your individual ... Read Answer >>
  6. What is the size of the average retirement nest egg?

    Learn about the average nest egg for retiring Americans and why you certainly do not want to be average when it comes to ... Read Answer >>
Hot Definitions
  1. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  2. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  3. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  4. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  5. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  6. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
Trading Center