Thirteen lakh investors, Rs 8,000 crore (Rs 80 billion) . . . tomorrow will be a big day for US-64 bond holders.

These tax-free bonds were issued in 2003 to bail out Unit Trust of India's flagship scheme US-64, which got into trouble because of lack of transparency in its portfolio composition and investment strategy.

Now these investors will finally get their due. And if you are among those, who have still not decided on what should be done with this windfall, financial advisors say the money should be channelled in instruments depending upon your age and risk profile.

"Responsibilities and risk appetite change according to the age of a person. This, in turn, should decide the investments made in different asset classes," said Kartik Jhaveri, director, Transcend India.

For instance, if you have retired or are on the verge of retirement, take a safety-first approach. This implies investing in instruments that would increase the size of the retirement corpus. To meet the monthly expenses requirement, invest in debt.

"If the investor wants safe returns on his investments, he can invest in RBI bonds. These are tax-free bonds and yield about 6.5 per cent returns," said financial planner Sajag Sanghavi.

There are other taxable debt investments as well such as floater schemes of mutual funds that return around 7 per cent on an average, but only if the money is deployed for three years or more. Floater schemes invest in corporate and government bonds and treasury instruments. They offer returns that are equivalent to the prevailing interest rates.

The senior citizens' savings scheme is another option that gives 9 per cent return annually. However, the income is taxed, based on the income bracket.

Another option is to look at monthly income plans, where 10 per cent of the corpus is invested in equities for returns that are slightly above the other debt-based funds. If you are above 40 years and have already accomplished financial goals, such as buying a house or owning a car, use the money to pre-pay any loans.

And if you have not invested enough for life after retirement, a part of the money should be deployed in diversified equity mutual funds because over a period of five to 10 years, they would give returns of 15 per cent and more.

If you are averse to risk, look at deep discount bonds that give returns of 12 per cent. For instance, Bhavishya Nirman Bonds, issued by Nabard, offer 12.15 per cent returns. However, remember that the accumulated sum would only come to you at the end of the tenure.

If you want, you can splurge a bit. As Hitungshu Debnath, executive director, wealth management services, AngelBroking, put it, "If your financial planning is running sound, you should give a treat yourself with a good vacation at this stage in life."

For youngsters, who have inherited the money by being a nominee or by invested in US-64 units in the early years of their careers, the best route now is pure equity funds or blue-chip stocks. With stock markets volatile, it is the right time to create a portfolio that will give good returns in the long run.