Are you a senior citizen looking for a reliable source of income to support your retirement savings? The Monthly Pension Scheme for senior citizens offers a practical solution to ensure financial stability during your golden years. This scheme provides a regular monthly pension, allowing you to enjoy a comfortable and independent lifestyle.
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The choice of a monthly pension scheme for senior citizens depends on your savings, your requirements, and risk tolerance, among other factors. Let us have a look at the best monthly old age pension schemes depending on various factors:
Government Pension Plans for Senior Citizens: For individuals who are averse to risk, you can look at government pension schemes that offer a monthly sum once you hit your retirement age.
Traditional Annuity Schemes: There are also traditional guaranteed annuity schemes that come with insurance protection.
ULIP Retirement Plans: Those who are willing to take some risks to grow their savings can explore retirement ULIPs that offer a life cover along with market-linked investments. These plans come with monthly annuity options that go on till the death of the policyholder.
Ensuring the growth, development, and financial security of senior citizens is the duty of every Government. To fulfill this responsibility, Government Ministries and their financial institutions have introduced various government-backed pension plans in India.
The following is the list of monthly pension scheme for senior citizens that will give you a better understanding of these pension schemes:
| Monthly Pension Scheme for Senior Citizens Names | Entry Age | Maturity Age | Policy Term (PT) | Tax Benefits |
| National Pension Scheme (NPS) for Senior Citizens | 18-70 Years of age | 60 Years of age (can be deferred up to 75 years of age) | Minimum 3 years of the lock-in period. | Income tax exempted under Sec. 80C and Sec. 80CCD (1B) of the Income Tax Act. |
| Pradhan Mantri Vaya Vandana Yojana (PMVVY) | Minimum 60 Years of age. | 70 Years of age and above. | 10 Years | GST exempted. |
| Senior Citizens Savings Scheme (SCSS) | Minimum 60 Years of age OR Person b/w 55-60 Years of age who opted for Voluntary retirement/Superannuation. OR Retired Defense Personnel b/w 50-60 Years of age. | Minimum 65 years of age (account extendable by 3 years) | Minimum 5 years | Income tax exempted under Sec. 80C of the Income Tax Act. |
| Atal Pension Yojana (APY) | 18-40 Years of age | 60 Years of age. | Minimum 20 years | Income tax exempted under Sec. 80C of the Income Tax Act. |
| Varishtha Pension Bima Yojana (VPBY) | Minimum 60 years of age. | 75 years of age and above. | Minimum 15 years | Income tax exempted under Sec. 80C of the Income Tax Act. |
| Employees Provident Fund (EPF) | 18 years of age and above. | 58 Years of age. | Minimum up to 50 years of age. | Tax exempted if EPF contribution is up to Rs. 7.5 lakhs and earned interest are less than Rs. 2.5 lakhs. |
| Indira Gandhi National Old Age Pension Scheme (IGNOAPS) | NA | 60 Years. | NA | NA |
Entry Age Criteria: A senior citizen in the age bracket of 60 to 70 years.
Policy Term: The policy benefits can continue till they turn 75 years of age. This gives investors 5 years to invest and benefit from the returns of market-linked instruments such as equities, Corporate Bonds, Government Bonds, etc.
On maturity, the policyholder can withdraw 60% of the accumulated funds.
No upper limit on the investment amount in the pension plan.
It is mandatory to invest a minimum of 40% of the income to purchase an annuity plan. This is to ensure a source of monthly income for senior citizens for the entirety of their lives.
The NPS is one of the most effective tax-saving instruments. You can save up to Rs. 1.5 lakhs in taxes under section 80C and up to Rs. 50,000 under section 80CCD (1B) of the Income Tax Act of India.
Entry Age Criteria: Any person aged 60 or above can purchase this monthly pension scheme for senior citizens.
Policy Term: This monthly pension scheme for senior citizens comes with a fixed policy term of 10 years.
Maximum Investment Limits: Rs. 1.62 Lakhs to Rs. 15 Lakhs. For a monthly pension, the minimum amount that you would have to invest is Rs. 1.62 Lakhs. The maximum purchase price is capped at Rs. 15 Lakhs.
Investment can be made monthly, quarterly, half-yearly, or yearly.
The corresponding minimum and maximum amount of pension you would be entitled to monthly are Rs. 1000 and Rs. 9250, respectively.
The policyholder also enjoys life coverage throughout the entire duration of the policy term.
The nominees shall be offered the purchase price in full in the event of the pensioner’s death.
Entry Age Criteria: Anyone aged 60 and above and falling in the BPL category. One can benefit from the monthly payout made by the Central Government to the beneficiaries.
Maximum Investment Limit: This is a non-contribution monthly pension scheme for senior citizens i.e., the beneficiary need not pay any premium amount.
This is a monthly pension scheme for senior citizens belonging to the low-income population of the country.
The Government of India funds this pension scheme under its National Social Assistance Programme (NSAP).
This government-backed pension plan is also known as National Old Age pension Scheme (NOAPS).
The pension amount can range between Rs. 300 to Rs. 500.
Entry Age Criteria: 18-40 years of age when subscribing to the plan. The monthly pension scheme for senior citizens will start at the age of 60 years.
Maximum Investment Period: Minimum contribution of premiums should be 20 years or above.
This is the best pension scheme to cover the social security of the citizens working in the unorganized sector.
Unorganized sector workers include agricultural laborers, small & marginal farmers, rickshaw pullers, blacksmiths, daily wage laborers, and more.
For a period of 5 years from joining the scheme, the Government of India also contributes 50% or Rs. 1000 (whichever is lesser) of the total contribution by the subscriber.
Based on the premiums deposited with the scheme, the pension plan subscriber will get a monthly pension b/w Rs. 1000 to up to Rs. 5000 per month from the age of 60 years.
The monthly pension increases if the pension plan is joined early.
Entry Age Criteria: 60 years of age or above OR persons within the age of 55-60 years who opted for a Voluntary Retirement Scheme/ Superannuation OR Retired Defense Personnel within the age group of 50-60 years.
Maximum Investment Limit: As per the latest Union Budget 2024 announced on 1st February 2024, the Lump sum premium payment allowed is from Rs. 1000 to up to a maximum of Rs. 30 lakhs.
This is the best monthly pension scheme for senior citizens offered by the Post Office.
Offers Single Life and Joint Life options in the pension plan.
It also offers Income Tax exemption benefits up to Rs. 1.5 lakhs.
Quarterly benefits are deposited in the SCSS account.
Entry Age Criteria:60 years of age and above.
Investment Limits: Yearly premiums b/w Rs. 63,960 to up to Rs. 6,39,610.
This is the best old age monthly pension scheme for senior citizens provided by the Government of India in association with the Life Insurance Corporation (LIC).
The pension payouts are done as per the decision of the subscriber in the frequencies of monthly/ quarterly/ half-yearly/ yearly.
Yearly pension payouts are offered b/w Rs. 6,000 to up to Rs. 60,000.
Tax exemptions on premium payments are allowed under Section 80CCC of the Income Tax Act, 1961.
Entry Age Criteria: 18 years and above. In this monthly pension scheme for senior citizens pension payouts are allowed from the age of 50 years.
Maximum Investment Limit: Enrolling in this scheme is mandatory for every employee working for a minimum of 10 years in the public or private sector and earning a salary up to Rs.15,000 or less.
Minimum Rs. 1000 monthly pension payouts are allowed.
All the premiums paid in the scheme are converted into pension payouts without any changes.
The widow/widower receives the pension in case of the demise of the employee.
If the widow/widower remarries, then the children of the employees receive the monthly pension until the age of 25 years.
The best annuity pension plans for senior citizens that are offered by insurance companies are listed below:
| Annuity Plan Name | Maximum Entry Age | Maximum Maturity Age | Policy Term (PT) | Premium Payment Term (PPT) | Tax Benefits |
| ABSLI Guaranteed Annuity Plus | 45-90 Years of age | 46-90 Years of age | Whole life | Single pay, Limited pay: 5-10 years | Tax exemption benefits u/Sec. 80C of the IT Act |
| HDFC Life Pension Guaranteed Plan | 30-85 Years of age | NA | NA | Single pay | Tax exemption benefits u/Sec. 80C of the IT Act |
| ICICI Pru Guaranteed Pension Plan | 30-100 Years of age | Minimum 31 years of age | NA | Single pay | Tax exemption benefits u/Sec. 80C of the IT Act |
| IndiaFirst Life Guaranteed Annuity Plan | 40-80 Years of age | NA | NA | Single pay | Tax exemption benefits u/Sec. 80C of the IT Act |
| Max Life Forever Young Pension Plan | 30-65 Years of age | NA | 20 Years | NA | Tax exemption benefits u/Sec. 80C of the IT Act |
| SBI Life Saral Retirement Saver | 18-65 Years of age | 40-70 Years of age | Maximum: 40 Years | Regular pay, Lump sum pay | Tax exemption benefits u/Sec. 80C of the IT Act |
| Tata AIA Life Insurance Guaranteed Monthly Income Plan | 6-60 Years of age | 65-68 Years of age | 5/ 8/ 12 Years | 5/ 8/ 12 Years | Tax exemption benefits u/Sec. 80C of the IT Act |
Disclaimer: ≈ Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is done in alphabetical order (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
This is the best pension plan for senior citizens that guarantees a retirement corpus ensuring your financial independence during your golden years.
The plan provides guaranteed bonuses in the first 5 years of policy payment.
The pension scheme also offers the rider option to get life coverage benefits.
The customers can also avail of all the tax exemptions as per the prevailing laws.
It offers guaranteed vesting benefits with reversionary bonuses.
This is one of the best old age pension plans available in the market right now. It offers a guaranteed income for as long as you or your spouse is alive.
It comes with 10 payout options that you can choose per your needs.
For instance, you can choose to receive a fixed monthly income in for life or have the sum increase by 3-5% after a period of time.
It is a single premium policy, meaning you would have to pay a lump sum at the time of policy purchase.
The minimum amount has been fixed at Rs. 1.5 Lakhs.
This is the best pension plan for senior citizens, ensuring post-retirement monthly income for their whole life.
The maximum entry age is fixed at 85 years for a senior citizen.
A single premium payment in HDFC Life Pension Guaranteed Plan will guarantee you a monthly income for life.
You can choose either a deferred annuity option or an immediate annuity option.
Further, you can purchase this policy for your wife.
This ensures that even on your death, the income benefit continues until she lives.
This is a monthly pension scheme for senior citizens looking for insurance protection and pension benefits after retirement.
With a choice of over 10 annuity options, the ICICI Pru Guaranteed Pension Plan also lets you increase your monthly income through its top-up facility.
If you choose the immediate annuity option, you will receive a monthly income immediately following the purchase.
Under the deferred annuity option, you can receive the payouts after a certain period.
In both cases, the pension amount continues till the time you live.
This is a Unit Linked Pension Plan (ULIP), meaning that the money you invest in this plan will go towards market-linked funds such as equity and debt funds. Therefore, the returns you earn will be dependent on the market performances of these funds. As such, the risk of investment is higher than all the other options discussed.
The fund options available to you are:
Pension Maximiser Option: It is a hybrid fund that invests in both debt instruments and equities. The risk profile is moderate.
Pension Preserver Option: A hybrid fund invests a majority in debt instruments. The risk profile is low.
A senior citizen in the age bracket of 60-65 years can buy this plan Max Life forever young pension plan. The plan comes with annuity benefits and safeguards the future of your spouse financially in the event of your death within the coverage period.
A senior citizen in the age bracket of 60-65 years can buy this plan.
The plan comes with annuity benefits and safeguards the future of your spouse financially in the event of your death within the coverage period.
This monthly pension scheme for senior citizens by Tata AIA Life Insurance helps its customers meet everyday expenses and guaranteed life coverage for a happy retirement.
It offers a monthly income for twice the number of years of your policy term.
You are offered an option to increase your monthly pension by paying Large Premium Booster amounts.
You can avail of the tax benefits of up to Rs.46,800.
It offers you the flexibility of payment options of Annual/ Semi-annual/ Quarterly/ Monthly.
The pension plan also offers rider options to give you additional security in case of critical illnesses, hospitalization, accidental death, or total disability situations.
This is the best monthly pension scheme for senior citizens covering your whole life and helping you to unburden from future healthcare costs.
It offers its customers to choose from 12 annuity options.
Return of Purchase (ROP) facility with Life Annuity option, Escalating life annuity option, Survivor annuity in Joint Life option, and Deferred Annuity option is also provided.
It makes sure to protect your loved one with annuity benefits financially.
The pension plan provides the Annuity Certain option that assures monthly income from a pre-decided period.
The changing demographics of India, with its increasing old-age population, demand a holistic approach that ensures the financial stability of senior citizens. The government and insurance companies have devised top pension plans for senior citizens in India, targeting this necessity. Having said that, it is a must for every working and old age population to subscribe to at least one of the best pension plans that fulfill their and their family’s financial needs once they retire.
˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance
plan.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
+Returns Since Inception of LIC Growth Fund
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
++Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
Tata AIA
Axis Max Life
Bajaj Allianz
SBI Life
HDFC Life
ICICI Prudential
Bharti AXA Life
Edelweiss Life
Kotak Life
Future Generali
PNB MetLife
Aditya Birla Sun Life
Aviva
Ageas Federal
Bandhan Life
Canara HSBC
IndiaFirst
Pramerica Life
Reliance Life
Sahara Life
Shriram Life
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