Post Office Monthly Income Scheme if you’re looking for risk-free investment choices. Learn about the interest rates and more benefits here.
If you're a senior citizen, you may not prefer to take risks with investments in mutual funds. For secure investment options, post office schemes are considered reliable. Government-supported schemes offer both secure and guaranteed returns. The return rate is higher than that of bank FDs. Moreover, the Post Office MIS provides a monthly income from a lump sum deposit.
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Some calculations
Investment: Lump sum deposit of Rs 9 lakh
Annual interest rate: 7.4%
Period: 5 years
Total interest income: Rs 3,33,000
Monthly income: Rs 5,550
Also read: Secure Your Future with Post Office RD Scheme; Learn about the interest rates and more benefits
Key points of Post Office MIS
• Up to ₹9 lakh in a single account and ₹15 lakh in a joint account can be deposited.
• After 5 years, you can withdraw the principal amount or extend the scheme for another 5 years.
• Interest is credited to the post office savings account monthly.
• No TDS is deducted on investments in the scheme, however the interest earned is taxable.
Also read: PPF vs NPS: Which is the better choice for your secure retirement?
Can you close the account before maturity?
You can withdraw money from the Post Office Monthly Savings Scheme after one year if needed. However, premature withdrawal before one year is not allowed. If you close the account prematurely, a penalty will be applied. Money can be withdrawn between 1 to 3 years with 2 percent deduction on the deposited amount.
Also read:SBI vs Post Office Fixed Deposits: Which one should you invest in?
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