What is best-suited for safe investments is the Post Office Monthly Income Scheme (MIS). The scheme offers not only the capital protection but also assists investors in generating fixed monthly income. The scheme is very much in demand, especially among senior citizens and conservative investors. Let us look into its salient features.
Key Features Of The Scheme
Investment limit: The minimum amount that can be invested under this scheme is ₹1,000. The maximum limit is ₹9 lakh in the case of a single account and ₹15 lakh in a joint account.
- Tenure: Its tenure is 5 years. After maturity, it can be renewed for an additional 5 years.
- Interest rate: The current interest rate is 7.4% per annum. This rate is subject to revision every quarter. The interest is calculated on a monthly basis but is paid out on a monthly basis.
- Premature closure: The account can be closed after 1 year in case of an emergency by charging a penalty of 2%.
Benefits And Features
- Government backing: The scheme has the backing of the Government of India and, hence, the investments are entirely safe.
- Monthly incomes: Investors receive a fixed cash amount every month, which can assist them in meeting their pension or other day-to-day expenses.
- Tax benefits: The amount invested qualifies for tax deduction under Section 80C for an amount up to ₹1.5 lakh; however, a tax will be levied on the monthly interest income.
- Straightforward process: With minimal documentation required to set up an account, this scheme is accessible in every post office.
Eligibility And Required Documents
Any Indian citizen above 18 years is eligible to invest in this scheme, whether individually or jointly. Minors too can open an account with the help of a guardian; an opportunity to enhance the habit of saving and investing from childhood! KYC documents required to open the account are Aadhaar, PAN, and address proof, as well as a passport-size photograph and completed nomination form, which would ensure a smooth investment process.
How To Apply
Get the form from any post office; fill it out and submit it along with KYC documents. The account will then be opened instantaneously and the first monthly income will start from the succeeding month of your investment.
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