This LIC-led scheme provides pension of Rs 9,250 per month to senior citizens

PMVVY is a pension Scheme for senior citizens with a minimum age of 60 years. There is no maximum age limit. This plan has a policy term of 10 years with minimum pension 1,000 to max 9,250 per month for the entire tenure.

This scheme is available for investment till March 31, 2023. However, LIC is offering a guarantee of 7.4% p.a. for 10 years on this plan for the financial year FY22 if purchased before March 31, 2022.

On its website, LIC states, “For FY 2021-22, the plan will provide an assured pension of 7.40% p.a. payable monthly. This assured rate of pension will be applicable for the full policy term of 10 years for all policies purchased. Will be payable. By 31st March 2022.”

The largest insurer in India, LIC is the only authority to operate the scheme.

This plan can be purchased with the payment of a lump sum amount. However, the pensioner will have the option to choose either the amount of pension or the purchase price. maximum amount 15 lakh can be invested in this scheme. It means that if an elderly spouse is planning to opt for this plan then both can invest maximum 30 lakhs and earn a fixed monthly pension of approx. 18500 for 10 years in a family.

The maximum pension scheme in the scheme is – Rs 9,250 per month, 27,750 per quarter, 55,500 per half year; And 1,11,000 per annum.

Under the scheme, the first installment of pension is payable after 1 year, 6 months, 3 months or 1 month from the date of purchase, which is yearly, half yearly, quarterly or monthly respectively depending on the mode of pension payment. ,

Similarly, depending on the different modes of pension payment, the scheme will offer an interest rate of 7.4% to a maximum of 7.66% per annum. For example, a senior citizen can earn at the rate of 7.4% on monthly installments, while the interest rate is 7.45% and 7.52% on quarterly and half-yearly installments. Also, for annual installments, the plan offers 7.66% per annum.

The interest rate of PMVVY is better than that of many bank fixed deposits and post office savings schemes. The government-owned Senior Citizens Savings Scheme (SCSS) offers 7.4% interest rate, while SBI gives 6.30% interest rate to senior citizens on their FDs. 2 crores over a period of 5 years to 10 years. In addition, ICICI Bank and HDFC Bank offer 6.35% interest rate to senior citizens on tenures ranging from 5 years 1 day to 10 years.

For investing in PMVVY, pension payment will be through NEFT or Aadhaar enabled payment system. Unique Aadhaar number verification is required for purchase of policies under this government-subsidized scheme.

There are many benefits available under PMVVY. On survival of the pensioner during the policy term of 10 years, arrears of pension (at the end of each term as per the method chosen) will be payable. However, on the death of the pensioner during the policy term of 10 years, the purchase price will be returned to the beneficiary. Meanwhile, a maturity benefit is also available on this plan where the purchase price along with the last pension installment will be payable, on survival of the pensioner till the end of the policy term of 10 years.

Also, loan facility is available under the plan, however, after the completion of 3 policy years. The maximum loan granted will be 75% of the purchase price. In particular, the rate of interest to be charged for the loan amount will be determined from time to time.

In addition, PMVVY allows premature exit during the policy term in exceptional circumstances such as the pensioner needs money for the treatment of any critical/terminal illness of himself or the spouse. The surrender value payable in such cases will be 98% of the purchase price.