Most of us fails to plan about our retirement, as it the last goal in the financial planning list. But as much late we are in the planning we are losing the opportunity of what our money would have earned by investing earlier.

“The question isn’t at what age I want to retire , its at what income…??”

As retirement is the last phase it gives us the maximum time to invest our money and earn returns, through compounding better returns can be earned and a large corpus can be created fulfilling retirement needs.

It’s the time when the individual is no longer in working phase, as he has resigned from his job or has reached to the age of 60 years or above.

Now the question is “WHY IS RETIREMENT PLANNING REQUIRED”?

Retirement Planning Required

The answer to this can be any of the following reasons :

To provide regular income 
Blissful retirement
Buying a House/Car 
Meeting for emergencies 
Maintaining life style
Debt Free
Fulfilling Dreams
Health Coverage

Want to live a Happy Retired Life….. But how….????

By making money to work for you

There are various schemes where investment can be done by senior citizens

senior citizens

Let us know about the specification in different schemes

  • SENIOR CITIZEN SAVING SCHEME

Senior citizen saving scheme was introduced by central government for the benefit of the senior citizen & retired persons, person are age of 60 years person who retired on superannuation (55-59 years) can also apply for this scheme.

The minimum deposit for account opening shall be Rs 1000 & maximum deposit in the account shall not exceed Rs 15 lakh at any time. The account can be in joint name with the spouse. An individual can open more than 1 account but the total deposit shall not exceed the maximum limit of all account i.e 15 lakh.

This scheme offers interest rate of 7.4% which is paid quarterly. The tenure of this account is for 5 years but if the investor wants then they might extend it for 3 more years. The deposit amount in this account gives us tax exemption u/s 80 c of income tax & and the interest received shall be exempted up to 50,000 u/s 80TTB.

  • PRADHAN MANTRI VAYA VANDHANA YOJANA

This Scheme was introduced by government to protect elderly person against the future fall in the interest income due to uncertain market. This is operated by LIC of INDIA. Person who have reached the age of 60 years are eligible to take benefit of this scheme.

This policy holds a term of 10 years, the minimum deposit amount is Rs 1000 & the maximum amount is of Rs 15 lakh. This scheme also offers loan facility to the person but after completion of 3 years & the maximum amount to avail loan is of 75% of purchase price.

The interest applicable to this scheme is 7.4% for 2020-21. Premature withdrawal is allowed if the individual himself or his/her spouse is suffering from critical illness but the redeemed amount shall be up to 98% of the purchased price.

  • POST OFFICE MONTHLY INCOME SCHEME

This Monthly Income Scheme offered by post office any resident can take up this scheme in his/ her name. Joint holding is also allowed in this scheme with the minimum amount is Rs 1000 account can be opened & the maximum limit in case of single holder is 4.5 lakh & for joint holding 9 lakh is the amount.

The interest applicable to this scheme is of 6.6%, holds a tenure of 5 years & premature withdrawal attracts a penalty to it.

  • DEBT MUTUAL FUNDS 

The debt scheme offered by mutual funds which are suitable for those investor who are not willing to take higher risk, the aim for these scheme is to generate regular income with steady returns & a bit of capital appreciation.

As these debt schemes invest in securities giving fixed interest income such as corporate bonds, commercial papers, treasury bills & other money market instruments which are not risky as equity investment, so this Scheme can also be preferred by senior citizens.

PARTICULARS SENIOR CITIZEN SAVING SCHEME PRADAHN MANTRI VAYA VANDANA YOJANA POST OFFICE MONTHLY INCOME SCHEME
ELIGIBILITY 60 Yr 60 yr Resident
Minimum amt 1000 1000 1000
Maximum amt 15 lakh 15 lakh 4.5 / 9 Lakh
Tenure 5+3 yrs 10 yrs 5 yrs
Interest Rate 7.40% 7.40% 6.60%
Tax exemption 1.5 Lakh
taxable interest exempted u/s 80 TTB Taxable
Operated by Banks / post office LIC Post office
Loan facility not allowed Allowed after 3 yrs upto 75% N.A.
Pre-maturity Subject to penalties for premature withdrawal For self/spouce if suffering from critical illeness Allowed after a discounting of amount

Retirement Planning is a important process. The earlier it started better it is This is a fact that we cant work whole life so every one should plan well & live a happy retired life.

Author Bio

Qualification: Graduate
Company: N/A
Location: AGRA, Uttar Pradesh, IN
Member Since: 24 Jul 2020 | Total Posts: 15
I have Cleared CA (intermediate) also cleared various series conducted by N.I.S.M (National Institute of Securities Market), Investment Advisory, Research Analyst, Merchant Banking & Retirement planning. Recently cleared exam of Independent Director conducted by IICA ( Indian Institute Of Corporate View Full Profile

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4 Comments

  1. Vipan Kumar verma says:

    At Dr.citizen saving scheme rebate is applicable u/s 80TT B not 80TTA .There was difference of Rs.40000/- Rs.50000 to sr citizen u/s 80TTB BUT Rs.10000 under 80TTA to non sr. Citizen below 60 years. Correct it.

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