LIC PMVVY scheme benefits, interest rate, calculation, last date to apply: Only a few months are remaining for senior citizens to subscribe to the Pradhan Mantri Vaya Vandana Yojana (PMVVY). Administered by LIC, PMVVY is a Government-subsidised pension scheme for senior citizens aged 60 years and above. The scheme provides immediate monthly/quarterly/half-yearly/yearly pension to senior citizens after they buy the plan by paying a lump sum up to Rs 15 lakh.
PMVVY will remain available for sale up to 31st March 2023. With only a few months left before the end of the PMVVY sale, let’s take a look at the benefits, eligibility and how much pension senior citizens can get by subscribing to this scheme.
According to the LIC website, senior citizens of India aged 60 years (completed) and above can purchase the PMVVY scheme. There is no upper age limit for purchasing this scheme.
PMVVY Scheme Term and Pension Payment Mode
The term of this scheme for senior citizens is 10 years. Pension under PMVVY can be paid on a monthly/quarterly/half-yearly or yearly basis, depending on the mode chosen by the buyer.
The first instalment of pension under PMVVY starts after 1 year, 6 months, 3 months or 1 month from the date of purchase of the scheme. For example, if you chose the monthly mode of pension payment, then your pension will start after 1 month if you purchase the scheme now.
PMVVY provides pension, death benefits and maturity benefits.
Depending on the pension mode chosen by the subscriber, PMVVY provides a pension for the policy term of 10 years. The purchase price of the policy is returned to the beneficiary on the death of the pensioner during the policy term of 10 years. If the subscriber survives the policy term of 10 years then the purchase price is returned along with the last instalment.
PMVVY Interest Rate
For policies purchased up to 31-03-2023, the interest rate applicable to the scheme will be 7.40% per annum payable monthly (i.e. equivalent to 7.66% per annum). This assured rate of interest will be payable for the full policy term of 10 years for all policies purchased till 31st march 2023.
PMVVY Minimum and Maximum Pension, Purchase Price
The minimum pension allowed under PMVVY is Rs 1000/month while the maximum pension allowed is Rs 9250/month.
The minimum purchase price available under the scheme is Rs 1,62,162 for monthly pension, Rs 1,61,074 for quarterly pension, Rs 1,59,574 for half-yearly pension and Rs 1,56,658 for yearly pension.
The maximum purchase price available under the scheme is Rs 15 lakh for monthly pension, Rs 14,89,933 for quarterly pension, Rs 14,76,064 for half-yearly pension and Rs 14,49,086 for yearly pension.
A senior citizen cannot invest more than Rs 15 lakh for purchasing PMVVY plans. One can surrender the policy at any time during the term of the policy.
Purchasing the policy for Rs 15 lakh will provide a monthly pension of Rs 9250 to a senior citizen for 10 years. The scheme will provide an annual pension of Rs 1,11,000 for the purchase price of Rs 14,49,086.
For example, if you subscribe to the scheme for a monthly pension of Rs 9250 by paying Rs 15 lakh, then in 10 years the scheme will return Rs 9250 x 12 x 10 = Rs 1,110,000 as the monthly pension. If you survive the 10-year policy term then the original purchase price of Rs 15 lakh will also be returned.
A minimum pension of Rs 1000/month for 10 years can be assured by purchasing the scheme for Rs 1,62,162.