Investment Options for Senior Citizens in India

  • Investment Options for Senior Citizens

  • Retirement is an important stage in every once life. Everybody, whether self-employed or salaried, expects to secure their lives post-retirement. This article discusses everything you need to know about various investment options post-retirement for senior citizens.

    Senior citizens who are retired from their work may have two options or situation from which they have to earn during their non working days.
    • Some may get Pension for their living and some corpus from their firms (Govt. or private)
    • Some do not get Pension but got good corpus which they have to utilize/invest to earn their monthly expenses
    As per my opinion senior citizens should not take risk by investing their money in to stock market or in Mutual funds, because they can’t wait to recover their money if the market falls suddenly. And also the stock market can’t provide them consistent returns or monthly income to cater their needs. Hence government of India has provided some financial tools by investing in them one can earn fixed and safe returns.
    Following are some options for Senior Citizens to invest in them
    • Senior Citizen Savings Scheme (SCSS)
    SCSS is an excellent investment option for senior citizens looking for long-term saving schemes which offer security with other additional benefits. You can avail the scheme from post offices and recognized banks around the country.
    Maximum Investment - Rs. 15,00,000 per person 
    Minimum entry age        - 60 Years
    Rate of Interest (From 01-04-2020) - 7.4% per annum (Interest paid quarterly)
    By investing Rs.15 lac one could earn Rs. 27,750 every quarter (1,10,000/ year)
    Not only is the rate of interest offered on this scheme comparatively higher than that of the regular savings and fixed deposit accounts, but you are also eligible for tax benefits up to Rs.1.5 lakh under Section 80C of the IT Act, 1961.This scheme is for 5 year tenure after that one can extend for next 3 years

    • Pradhan Mantri Vaya Vandana Yojana
    This option was to close on 31st March 2020, but now its has been extended till 31st March 2023
    this scheme is provided by LIC and it is for 10 years,
    Maximum investment - 15,00,000
    Minimum investment - 1,50,000
    Interest rate  - 7.4% per annum

    •  Fixed Deposits (Bank and Post Office)
    Fixed Deposits (FD) is one of the most common types of investments made by retired individuals. Banks also offer a comparatively higher rate on FDs for pensioners. Under Section 80TTB of the IT Act, an interest income up to Rs.50,000 for senior citizens during a financial year is completely tax-free.
    In case you are investing in post office FDs, you will be offered the same tax benefits as that of the bank deposits. However, post offices offer an additional layer of security on your deposits. The funds in your post office deposit account are directed towards the government to ensure that there is no delay in payments.
    You can also consider investing in the Post Office Monthly Income Scheme (POMIS), which offers a monthly income. Though you can avail tax benefits on investments up to Rs.1.5 lakh on FDs with a five-year maturity period, the interest income on the same is liable for taxation.
    • LIC Jeevan Shanti Plan
    LIC Jeevan Shanti Plan is a non-linked, non-participating, single premium annuity plan where you have the dual benefit of returns via immediate or deferred annuity. This plan can be availed online as well as through the offline mode. The payout modes of immediate and deferred are further divided into multiple options which provide return of annuity purchase price as well as returns. Each of these options have their own unique set of features and benefits.
    This plan suits for both senior citizens and people who are grate than 30 years. This plan will give good and consistent return as per individuals need

    If you need any details about any above mentioned plans then please write in the comment I will try to explain in details


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