Whenever we think of risk-free investments, we first think of bank and post office schemes. Apart from Recurring Deposit (RD) and Fixed Deposit (FD), the post office offers some schemes that give regular income. Today, we will talk about the Post Office MIS (Monthly Income Scheme).
This scheme is good for those who want fixed monthly income and do not want to take any risk. You deposit a fixed amount and get interest on it. Currently, this scheme gives an interest rate of 7.4%. Like every scheme, it also has some rules. If you do not know them, you may face losses.
How does the Post Office Monthly Income Scheme work?
In this scheme, you make a one-time deposit for 5 years. The interest is credited to your account every month, giving you regular income. After five years, you get your full amount back. This way, your money stays safe, and you can earn at the same time.
How to Earn Up to ₹9,250 per Month
POMIS (Post Office Monthly Income Scheme) allows you to open individual or joint accounts. The deposit limits are different. You can deposit up to ₹9 lakh in a single account. In a joint account, the limit is ₹15 lakh.
If you deposit ₹15,00,000 in a joint account at an interest rate of 7.4%, you can earn ₹9,250 per month.
Calculation Example
If you invest ₹15,00,000 in a joint account:
Annual interest = 7.4% of 15,00,000
Monthly income = 15,00,000 × 7.4 ÷ 100 ÷ 12 = ₹9,250
Yearly income = ₹9,250 × 12 = ₹1,11,000
Income in 5 years = ₹1,11,000 × 5 = ₹5,55,000
Withdrawal Before 5 Years
If you need to withdraw money before 5 years, you can, but only after 1 year. Premature withdrawal has a penalty:
Between 1–3 years: 2% penalty
Between 3–5 years: 1% penalty
For example:
If you withdraw after 2 years, 2% of ₹15,00,000 = ₹30,000 penalty
If you withdraw after 4 years, 1% of ₹15,00,000 = ₹15,000 penalty
So, it is better not to withdraw money before 5 years. After 5 years, you will get your full money back.
Who Can Open This Account?
Any Indian citizen can open a POMIS account. You can also open an account in your child’s name. If the child is under 10, the guardian will manage the account. You need a post office savings account. Aadhaar card and PAN card are required as proof.
Beneficial for Senior Citizens
Anyone can use this scheme, but it is very helpful for senior citizens. They get a fixed monthly pension, which helps with daily needs, and their money stays safe.