We all look for investments that are safe and secure, and which also provide high-interest rates. Investors looking for such investment options with a view to get monthly income can opt for the government-run Post Office Monthly Income Scheme (MIS).
It is one of the small savings investment schemes that offer steady income and is especially suited for conservative investors and senior citizens. It can be started with a nominal amount, which makes this scheme one of the popular investment options in India. It is a low-risk investment option, which comes with an investment period of 5 years. The interest rate offered by Post Office MIS is 7.6 per cent per annum from 1st July 2019, payable annually.
Find out some of the top features and benefits of the Post Office MIS scheme;
- This investment option is a fixed income scheme, and the money deposited by investors are not subject to market risk, which is why the scheme is a low-risk investment. As this is a government-backed scheme, the investments are also protected by the government until maturity.
- Investments with MIS comes with a lock-in period of 5 years, which can be withdrawn or re-invested once the investment matures.
- As low as Rs 1,000 can be invested to start a monthly income scheme. Investors can also multiply this amount over time.
- Investments in this Post Office scheme does not fall under section 80C. Hence, income is subjected to taxation, but it has no TDS.
- Starting from the first month of making the investment investors will receive the payout from this scheme, which comes at the end of every month, and not the beginning.
- The returns from the investment in POMIS earn guaranteed returns in the form of interest every month, but it does not beat inflation.
- An investor can have multiple account ownership, however, the total deposit amount cannot exceed Rs 4.5 lakhs all together.
- With MIS investors can open a joint account, with up to 3 people. Note that, the account belongs to all account holders equally, irrespective of who is making the contribution.
- An account can also be opened on behalf of a minor aged 10 or above, however, the total deposited amount cannot exceed Rs 3 lakh.
The minor on whose behalf the account is opened will be able to access the funds after reaching 18 years of age.