Investment: Which is better for you: the Post Office MIS scheme or LIC's Jeevan Shanti scheme?
People in India looking for safe investments always want to choose schemes where their money is secure, and they can also get a regular income when needed. Keeping this need in mind, the Post Office Monthly Income Scheme (POMIS) and LIC's Jeevan Shanti plan are quite popular. Both schemes work differently and cater to the needs of different types of people. Let's understand in simple terms what these two schemes are, how they work, and which one might be better for you…
What is LIC Jeevan Shanti?
LIC Jeevan Shanti is a single-premium pension plan. This means you only have to deposit money once, and then you start receiving a regular pension after the chosen period in the policy. It offers two types of annuity options: Single Life and Joint Life. This means you can choose to receive a pension only for yourself or for both you and your spouse.
The special feature of this plan is that the annuity rates (i.e., the pension you receive every year/month) are fixed at the time of starting the policy. Regardless of future market conditions, your pension will continue to be paid on time. This is why this scheme is quite popular among those planning for retirement.
What is Post Office MIS?
The Post Office Monthly Income Scheme (POMIS) is an investment scheme that provides you with a fixed return every month. Currently, this scheme offers a guaranteed interest rate of 7.4% per annum, which is paid monthly. This is ideal for those who need a stable income to meet their monthly expenses.
It requires a minimum investment of only Rs. 1,000 to start. A single or joint account can be opened. A joint account can include a maximum of three people. The account tenure is five years, and the money is returned upon maturity.
What is the difference between the two schemes?
LIC Jeevan Shanti is a pension-based plan where income starts after a period of time, while POMIS starts providing monthly income immediately. In Jeevan Shanti, the minimum investment is Rs. 1.5 lakh, and there is no maximum limit. In contrast, POMIS has a maximum limit of ₹9 lakh for a single account and ₹15 lakh for a joint account.
The Jeevan Shanti policy can be surrendered at any time, while closing a POMIS account prematurely incurs a penalty. Jeevan Shanti also offers tax benefits under Section 80C of the Income Tax Act, whereas POMIS does not offer any tax exemptions.
Which scheme is better for you?
If you are planning for retirement and want a regular pension for yourself and your family for a long period, then LIC Jeevan Shanti is a strong option. It is also good for those who want a stable and secure income for the future.
On the other hand, if you want low risk and an immediate monthly income, then POMIS is the right choice for you. It is considered an easy and reliable scheme for senior citizens, housewives, and small investors. Both schemes are good, but the right choice depends on your needs, investment capacity, and income sources.
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