The scheme is specially designed for senior citizens and investors who need regular income along with government security on their deposits. Let us understand the intricacies of this scheme and the wonderful benefits available in it.
7.4% interest rate: A better option than bank FD?
At present, on this monthly income scheme of the post office, 7.4 percent Interest is being given at an attractive rate of Rs. The government reviews this rate every quarter. The special thing is that once you invest, the interest amount you receive remains constant for the entire maturity period, due to which market fluctuations have no impact on your profits.
Understand the math: How much will you earn on an investment of ₹9 lakh?
The biggest strength of the POMIS scheme is its fixed income. If you exceed the maximum limit in your single account i.e. ₹9,00,000 If you deposit in lump sum, then at the current interest rate of 7.4% you will get approximately Rs. ₹5,550 There will be an income of Rs. This amount is transferred directly to your savings account, which you can use for your monthly expenses.
Investment Limit: Single and Joint Account Rules
Post Office has fixed investment limits according to different needs:
Minimum Investment: One can start with just ₹1,000.
Single Account: An individual can invest up to a maximum of ₹9 lakh.
Joint Account: Husband and wife together can deposit a lump sum of up to ₹ 15 lakh.
Rule: A person cannot invest more than the prescribed limit in all his accounts combined.
What is the penalty for premature withdrawal of money?
Although this scheme comes with a maturity period of 5 years, there are some rules to close it in case of emergency:
Before 1 year: You cannot withdraw your money.
Between 1 to 3 years: From the principal amount on account closure 2% will be deducted.
Between 3 to 5 years: From the principal amount on account closure 1% Will be cut.
Tax mathematics and caution
Before investing in this scheme, it is important to know that the amount deposited in POMIS Section 80C No tax exemption is available under this. Also, the interest received every month is added to your total income and tax is payable on it as per your tax slab. However, the post office does not deduct any TDS on this interest.
Note: This news has been prepared for general information purposes. It would be better to take advice from a financial advisor before investing.
