Planning for retirement in 2026 requires a disciplined investment strategy and the right mix of growth-oriented mutual funds. Small-cap mutual funds, despite their volatility, offer strong long-term potential and can significantly boost retirement wealth when chosen carefully. In this article, we highlight the Top 5 Best Retirement Investment Mutual Fund Plans for 2026, backed by performance data, fund strength, and long-term CAGR numbers.
🔹 1. SBI Small Cap Fund
One of the most trusted small-cap schemes, SBI Small Cap Fund has delivered strong long-term returns backed by a disciplined stock-picking approach.
Fund Details
| Parameter | Data |
|---|---|
| AUM | ₹36,945.09 Cr |
| Category | Equity: Small Cap |
| Fund Type | Open-End |
| 1M | 0.41% CAGR |
| 3M | 2.33% CAGR |
| 6M | 3.87% CAGR |
| 1Y | 1.03% CAGR |
| 3Y | 15.60% CAGR |
| 5Y | 23.35% CAGR |
| 10Y | 19.55% CAGR |
Why it is good for retirement:
Long-term stability, strong fund management, and consistent performance over a decade.
🔹 2. Nippon India Small Cap Fund
This is one of India’s largest small-cap schemes, known for strong wealth creation over the long term.
Fund Details
| Parameter | Data |
|---|---|
| AUM | ₹68,969.15 Cr |
| Category | Equity: Small Cap |
| Fund Type | Open-End |
| 1M | 1.05% CAGR |
| 3M | 3.69% CAGR |
| 6M | 4.86% CAGR |
| 1Y | 2.53% CAGR |
| 3Y | 23.66% CAGR |
| 5Y | 32.05% CAGR |
| 10Y | 21.62% CAGR |
Why it is good for retirement:
Outstanding long-term CAGR and strong risk-adjusted returns.
🔹 3. HDFC Small Cap Fund
HDFC AMC’s strong research-driven strategy has helped this fund deliver healthy long-term performance.
Fund Details
| Parameter | Data |
|---|---|
| AUM | ₹38,412.10 Cr |
| Category | Equity: Small Cap |
| Fund Type | Open-End |
| 1M | 1.34% CAGR |
| 3M | 3.36% CAGR |
| 6M | 8.48% CAGR |
| 1Y | 7.47% CAGR |
| 3Y | 23.48% CAGR |
| 5Y | 29.63% CAGR |
| 10Y | 19.73% CAGR |
Why it is good for retirement:
Consistent alpha generation, ideal for long-term SIP investors.
🔹 4. Axis Nifty Smallcap 50 Index Fund
This is a passive index fund that mirrors the Nifty Smallcap 50 index—ideal for low-cost retirement investing.
Fund Details
| Parameter | Data |
|---|---|
| AUM | ₹557.59 Cr |
| Category | Equity: Small Cap |
| Fund Type | Open-End |
| 1M | 2.27% CAGR |
| 3M | 4.75% CAGR |
| 6M | 6.34% CAGR |
| 1Y | 4.64% CAGR |
| 3Y | 27.18% CAGR |
| 5Y | NA CAGR |
| 10Y | NA CAGR |
Why it is good for retirement:
Diversified exposure with low expense ratio; ideal for passive long-term SIPs.
🔹 5. Bandhan Small Cap Fund
A strong contender in the small-cap category with excellent 3–5 year performance.
Fund Details
| Parameter | Data |
|---|---|
| AUM | ₹17,380.29 Cr |
| Category | Equity: Small Cap |
| Fund Type | Open-End |
| 1M | 2.84% CAGR |
| 3M | 5.77% CAGR |
| 6M | 9.54% CAGR |
| 1Y | 9.18% CAGR |
| 3Y | 33.53% CAGR |
| 5Y | 31.60% CAGR |
| 10Y | NA |
Why it is good for retirement:
Exceptional mid-term returns—excellent for aggressive retirement planning.
🟦 Comparison Table (Top 5 Funds)
| Fund Name | 1Y | 3Y CAGR | 5Y CAGR | 10Y CAGR | AUM |
|---|---|---|---|---|---|
| SBI Small Cap | 1.03% | 15.60% | 23.35% | 19.55% | ₹36,945 Cr |
| Nippon India Small Cap | 2.53% | 23.66% | 32.05% | 21.62% | ₹68,969 Cr |
| HDFC Small Cap | 7.47% | 23.48% | 29.63% | 19.73% | ₹38,412 Cr |
| Axis Nifty Smallcap 50 Index | 4.64% | 27.18% | NA | NA | ₹557 Cr |
| Bandhan Small Cap | 9.18% | 33.53% | 31.60% | NA | ₹17,380 Cr |
Conclusion
For investors planning for retirement in 2026, small-cap mutual funds can be powerful wealth creators. While volatility is high in the short term, their long-term CAGR performance makes them ideal for SIP-based retirement planning. The funds listed above offer a solid mix of stability, performance, and long-term growth.
Disclaimer
This article is for educational and informational purposes only. Mutual fund investments are subject to market risks, and past performance is not indicative of future returns. Please consult your financial advisor before making any investment decisions. The data provided here is based on publicly available sources and may change over time. Affiliate links may be included, and I may earn a commission at no extra cost to you.
This content is created by Abhishek Chouhan, AMFI Registered Mutual Fund Distributor, ARN-165168.
External Links:
- https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/large-cap-fund.html
- https://www.amfiindia.com/research-information
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