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Government guarantee scheme: Get Rs 10000 per month for 10 years by investing Rs 15 lakh

Sunil Dhawan
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One attractive investment option for senior citizens is going to close soon. The Pradhan Mantri Vaya Vandana Yojana (PMVVY), a fixed return pension scheme for senior citizens, is closing on March 31, 2020. PMVVY is a 10-year pension scheme with an option to take a regular income on a monthly, quarterly, half-yearly, or on annual basis. As per the rules, the maximum investment that can be made in PMVVY is restricted to Rs 15 lakh per senior citizen and the maximum monthly pension in PMVVY is Rs 10,000 per senior citizen. So, if both spouses are above age 60, the maximum monthly pension can be Rs 20,000 in the family. The pension in PMVVY is not dependent on the age of the investor.

PMVVY Calculator

The sample pension rates (SPR) per Rs.1000 of Purchase Price for different modes of pension payments are as below:

  • Yearly: Rs. 83.00 per annum
  • Half-yearly: Rs. 81.30 per annum
  • Quarterly: Rs. 80.50 per annum
  • Monthly: Rs. 80.00 per annum

The formula for PMVVY Calculation is –

(Amount invested * SPR) / 1000

Where, SPR is sample pension rate.

So, if you want to invest Rs 10 lakh in PMVVY, the monthly pension will be Rs 6667.

= (1000000 * 80) / 1000 = Rs 6667.

PMVVY return calculator

Based on the mode of pension, the returns in PMVVY will vary. For annual pension, the PMVVY interest rate comes to 8.3 per cent per annum, 8.13 per cent per annum for half-yearly pension, 8.05 per cent per annum for quarterly pension and 8 per cent per annum for monthly pension.

PMVVY Table – Investment Amount

The amount invested in PMVVY is called Purchase Price, the minimum and maximum amount of which is capped. If you are opting for monthly pension, the minimum investment will be Rs 1.5 lakh while the maximum can be Rs 15 lakh.

Mode of Pension: Yearly

Minimum Purchase Price : Rs 1,44,578
Maximum Purchase Price : Rs 14,45,783

Mode of Pension: Half-yearly

Minimum Purchase Price : Rs 1,47,601
Maximum Purchase Price : Rs 14,76,015

Mode of Pension: Quarterly

Minimum Purchase Price :Rs 1,49,068
Maximum Purchase Price :Rs 14,90,683

Mode of Pension: Monthly

Minimum Purchase Price :Rs 1,50,000
Maximum Purchase Price :Rs 15,00,000

PMVVY Pension Amount

If you are opting for annual pension, the minimum annual pension will be Rs 12,000 based on the minimum purchase price of Rs 1,44,578, while the maximum annual pension will be Rs 1,20,000 based on the maximum purchase price of Rs 14,45,783.

Minimum Pension

  • Rs. 1,000 per month
  • Rs. 3,000 per quarter
  • Rs.6,000 per half-year
  • Rs.12,000 per year

Maximum Pension

  • Rs. 10,000 per month
  • Rs. 30,000 per quarter
  • Rs. 60,000 per half-year
  • Rs. 1,20,000 per year

As an investor, you can decide on the basis of the pension amount that you want or the purchase price that you want to invest in PMVVY. So, if you want to get a half-yearly pension of Rs 60,000, you need to invest Rs 14,76,015.

To invest in PMVVY, one needs to approach LIC as it is the sole institution allowed by the government to offer the plan, both online and offline. The investment can be done after filling the application form online. Invest in PMMY after proper review of the scheme, your tax slab and is it suits your needs.