Retirement Planning schemes

Pradhan Mantri Vaya Vandana Yojana

Posted By: Admin

Are you a senior citizen worried about market fluctuations?

Are you worried about decreasing Fixed Deposit interest rates?

Are you a Retiree searching for an Instrument that gives a fixed pension after retirement?

The Answer for these questions “Pradhan Mantri Vaya Vandana Yojana” ( PMVVY).

PMVVY is an Assured Pension Scheme specially made for senior citizens (above age 60). This scheme can give you a fixed pension for a period of 10 years. It provides a minimum assured monthly pension of Rs 1,000 per month at a rate of 7.40% for an investment of Rs 1.62 Lakhs and maximum assured monthly pension of Rs.9,250 at a rate of 7.40% for an investment of Rs 15.00 lakhs.

Some of the notable benefits are:

At the end of 10 years if the pensioner survives, the purchase price along with final pension is paid back;
On death of the Pensioner within 10 years the purchase price is paid to the beneficiary;
Loan can be availed after completing 3 years of the policy and maximum loan shall not exceed 75% of the purchase price;
The scheme provides 98% surrender value for the expenses of treatment for any Critical/Terminal illness of self/spouse;

There is some eligibility Criteria for entering into this scheme:

The minimum Entry age is 60 years.
The policy tenure is 10 years.

Mode of Pension	Minimum Purchase Price	Maximum Purchase Price
Yearly	₹ 1,56,658	₹ 14,49,086
Half Yearly	₹ 1,59,574	₹ 14,76,064
Quarterly	₹ 1,61,074	₹ 14,89,933
Monthly	₹ 1,62,162	₹ 15,00,000


Mode of Pension	Minimum Pension	Maximum Pension
Yearly	₹ 12,000	₹ 1,11,000
Half Yearly	₹ 60,000	₹ 55,000
Quarterly	₹ 3,000	₹ 27,750
Monthly	₹ 1,000	₹ 9,250

Taxation : Being a Pension, the entire income is taxable and therefore this scheme would be most useful for Senior Citizens with low or no tax liability.

Conclusion:

For Senior Citizens looking to get a fixed monthly pension on a guaranteed basis, PMVVY is a great offer.

By: Santhosh