Article

Retirement planning – 4 Ways to Invest Money After Retirement

07 Aug 2019 Nutan Gupta

People look forward to living a relaxed life after their retirement. However, in order to live a tension free life after retirement, one needs to plan for his financial well-being well in advance. One of the most important things one needs to consider after his retirement is a regular flow of income in order to maintain one’s standard of living.

Here are some investment options you can consider investing your money in after retirement.

Instrument Lock-in Period Rate of interest
Senior Citizens Savings Scheme 5 years 8.5%
Post Office Monthly Income Scheme 5 years 7.7%
Post Office Time Deposit 1-year
2-year
3-year
5-year
7%
7.1%
7.3%
7.8%
Bank Fixed Deposit 5-10 years 6%

Senior Citizens Savings Scheme

As the name suggests, senior citizens savings scheme is a scheme launched by the government of India for senior citizens. An individual aged 60 years and above is eligible to invest in this scheme. If an individual has voluntarily opted to retire at the age of 55, he is also eligible to invest. An individual can invest a maximum of Rs. 15 lakh in SCSS. Investment in SCSS qualifies for a tax deduction under Section 80C of the Income Tax Act. This scheme comes with a lock-in period of 5 years and can be extended for another 3 years after that. SCSS gives an interest of 8.5%.

Post Office Monthly Income Scheme

POMIS ensures regular flow of income after retirement. The minimum investment that an individual can make is Rs. 1,500 and he can invest a maximum of Rs. 4.5 lakh. Joint account can be opened by two or three adults. All joint account holders have equal share in each joint account. Single account can be converted into joint and vice-versa. The maximum investment amount for joint account holders is Rs. 9 lakh. This scheme comes with a lock-in period of 5 years. POMIS offers an interest rate of 7.7%.

Post Office Time Deposit

Post office time deposits are similar to bank fixed deposits. The minimum amount which an individual can invest is Rs. 200, while there is no cap on the maximum amount that can be invested. The period for which an individual can deposit in this scheme can be 1-year, 2-year, 3-year and 5-year. The interest rate for all these periods are 7%, 7.1%, 7.3% and 7.8% respectively. The investment under 5-years time deposit qualifies for a tax benefit under Section 80C of the Income Tax Act.

Bank Fixed Deposit

Bank fixed deposits are offered by all the banks - public and private. As these deposits are offered by banks, they are safe in nature. Banks offer a rate of interest of 6% to senior citizens for a term of 5 years up to 10 years. Senior citizen fixed deposit also qualifies for a tax deduction under section 80C of the Income Tax Act.

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Retirement planning – 4 Ways to Invest Money After Retirement

07 Aug 2019 Nutan Gupta

People look forward to living a relaxed life after their retirement. However, in order to live a tension free life after retirement, one needs to plan for his financial well-being well in advance. One of the most important things one needs to consider after his retirement is a regular flow of income in order to maintain one’s standard of living.

Here are some investment options you can consider investing your money in after retirement.

Instrument Lock-in Period Rate of interest
Senior Citizens Savings Scheme 5 years 8.5%
Post Office Monthly Income Scheme 5 years 7.7%
Post Office Time Deposit 1-year
2-year
3-year
5-year
7%
7.1%
7.3%
7.8%
Bank Fixed Deposit 5-10 years 6%

Senior Citizens Savings Scheme

As the name suggests, senior citizens savings scheme is a scheme launched by the government of India for senior citizens. An individual aged 60 years and above is eligible to invest in this scheme. If an individual has voluntarily opted to retire at the age of 55, he is also eligible to invest. An individual can invest a maximum of Rs. 15 lakh in SCSS. Investment in SCSS qualifies for a tax deduction under Section 80C of the Income Tax Act. This scheme comes with a lock-in period of 5 years and can be extended for another 3 years after that. SCSS gives an interest of 8.5%.

Post Office Monthly Income Scheme

POMIS ensures regular flow of income after retirement. The minimum investment that an individual can make is Rs. 1,500 and he can invest a maximum of Rs. 4.5 lakh. Joint account can be opened by two or three adults. All joint account holders have equal share in each joint account. Single account can be converted into joint and vice-versa. The maximum investment amount for joint account holders is Rs. 9 lakh. This scheme comes with a lock-in period of 5 years. POMIS offers an interest rate of 7.7%.

Post Office Time Deposit

Post office time deposits are similar to bank fixed deposits. The minimum amount which an individual can invest is Rs. 200, while there is no cap on the maximum amount that can be invested. The period for which an individual can deposit in this scheme can be 1-year, 2-year, 3-year and 5-year. The interest rate for all these periods are 7%, 7.1%, 7.3% and 7.8% respectively. The investment under 5-years time deposit qualifies for a tax benefit under Section 80C of the Income Tax Act.

Bank Fixed Deposit

Bank fixed deposits are offered by all the banks - public and private. As these deposits are offered by banks, they are safe in nature. Banks offer a rate of interest of 6% to senior citizens for a term of 5 years up to 10 years. Senior citizen fixed deposit also qualifies for a tax deduction under section 80C of the Income Tax Act.