The government has planned to announce a new pension plan under the budget 2018-2019 for senior citizens. The new plan to be announced by the government is named PM’s Vaja Vandana Yojana Pension Plan.
PMVVY is a Pension Scheme announced by the government exclusively for the senior citizens aged 60 years and above and will be available from 4th May 2017 to 3rd May 2018. This scheme can be purchased online through Life Insurance Corporation of India which has been given the sole privilege to operate the scheme.
Financial planners say that this scheme will offer more avenues to the senior citizens to earn steady regular income at the time of falling interest rates.
Following are the major benefits under the PMVVY:
- This scheme provides an assured return of 8% payable monthly for 10 years
- The pension is payable at the end of each period, during the policy term of 10 years, as per the frequency of monthly/quarterly/half yearly/yearly as chosen by the pensioner at the time of the purchase.
- This scheme is exempted from service tax/ GST
- On survival of the pensioner to the end of the policy term of 10 years, purchase price along with the final pension installment shall be payable
- Loan up to 75% of purchase price shall be allowed after 3 policy years
- The scheme also allows for the premature exit for the treatment of any critical or terminal illness of self or spouse. On such premature exit, 98% of the purchase price shall be refunded.
- On the death of the pensioner during the policy term of 10 years, the Purchase Price shall be paid to the beneficiary.
- The ceiling of maximum pension is for a family as a whole, the family will comprise of the pensioner, his /her spouse, and dependents.
- The shortfall due to the difference between the interest guaranteed and the actual interest earned and the expenses relating to the administration shall be subsidized by the government of India and reimbursed to the corporation.
With the scheme PMVVY, it is sure that you are entitled to gain 8% on maturity. So if you are looking forward to guaranteed income then PMVVY is the right pension plan for all the senior citizens.
