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5 Government Schemes for Senior Citizens That Will Help Create Steady Income Research Team | Posted On Thursday, September 05,2019, 03:10 PM

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5 Government Schemes for Senior Citizens That Will Help Create Steady Income



Retirement is a phase where people can finally take some time off from work and duties and focus on their health and well-being. To make your retirement stress-free and enjoyable, you need to be financially equipped and must have a sizable corpus to meet the demands of old age like the cost of living, cost of treatment and so on.

Planning for retirement will help build a corpus by maximizing your investment potential. Here are some important government schemes that help receive a steady income during retirement.

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5 Government Schemes for Senior Citizens That Will Help Create Steady Income

Senior Citizen Savings Scheme:

This is a government-backed senior citizen savings scheme meant to benefit senior citizens post retirement. The scheme can be availed by defense personnel and people who have opted for VRS or superannuation at the age of 55 years.

This scheme is an ideal investment option for retirees and senior citizens who want good returns on investment. The scheme offers quarterly interest payouts which can be directed to the applicant’s savings bank account, providing an avenue for senior citizens to create an income post-retirement. The returns on the scheme are steady and the current rate of interest is 8.6% making it an attractive investment options for retirees.

See Also: Investment Options for Senior Citizens

Pradhan Mantri Vaya Vandana Yojana:

This government scheme is exclusively for senior citizens. The scheme is managed by LIC India that gives a fixed interest rate of 8% per year on deposits. The scheme has a flexible pension payment option where the beneficiary can choose the payment tenure. Pension is payable at the end of each term for a maximum period of 10 years. The maximum amount of investment that can be made under this scheme is Rs 15 Lakhs. However, the scheme comes with no tax benefits and charges a 2% penalty on early withdrawals.

Varista Pension Bima Yojana:

The Varista Pension Bima Yojana is a senior citizen pension scheme backed by the Indian government and incorporated by LIC India. The beneficiaries under this scheme receive an annual interest of 8% for a period of 10 years. This is a pension scheme that provides annuity benefits and regular payouts to senior citizens. The scheme is specially designed to cater to the needs of the senior citizens and the beneficiaries can avail the scheme without medical check-up.

However, the scheme has a lock-in period of about 15 years which is why the policyholder is given the choice to exit the scheme within 15 days from the start date, in case he is not happy with the scheme. The scheme comes with added benefits of tax exemptions and flexible payment options. The scheme also offers premature withdrawal facility in case of critical illness and loan facility.

See Also: PMVVY: A Pension For Senior Citizens

Rastriya Vayoshri Yojana:

The scheme was launched by the government of India to support senior citizens living below the poverty line or BPL families. The beneficiaries suffering from conditions like low vision, hearing impairment, loss of teeth and locomotor disability will be given assistance through assisted living devices.

This is a central government scheme fully funded by the central government. Under this scheme, physical aids will also be provided to the senior citizens. The scheme also reserves 30% of the aids to woman beneficiaries from each state. Some of the assistance devices provided under this scheme are walking sticks, elbow crutches, walkers, hearing aids, wheelchairs and artificial dentures. The scheme would be successfully implemented in 260 districts benefitting 5 Lakh senior citizens in the year 2019-2020. The main condition to join this scheme is that the beneficiary must be a BPL cardholder. 

See Also: Investment Options for Senior Citizens

Indira Gandhi National Old Age Pension Scheme:

The scheme was launched in the year 2007 by the Ministry of Rural Development. The scheme is a national social assistance scheme that aims to provide assistance benefits to senior citizens and people with disabilities. The scheme also provides assistance to widows. The eligibility of this scheme is 60 years and above. The beneficiaries of this scheme receive a monthly pension of Rs 300 for the age group of 60 to 79 years and above the age of 80 the beneficiary receives a monthly pension of Rs 500. 

This is a non-contributing scheme, which means the pension amount is partly paid by the state government and partly by the central government. The eligible BPL cardholders can enroll in this scheme and receive a monthly pension. The pension amount will be directly credited to the savings account of the beneficiary each month.

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