LIC Senior Citizen Scheme: 5 Retirement Saving Plans

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LIC has come up with 5 different plans to protect the interest of senior citizens. Through these plans, the elderly can enjoy regular pensions every month, quarter, six months, or every year. Read on to learn more about the LIC Senior Citizen Scheme.

One of the major fallouts of demonetization that severely impacted the senior citizen population of our country was the cut in rate of interest on fixed deposits or FDs. As such, the Government of India came up with a pension scheme exclusively for senior citizens that promises a fixed return of 8% interest to them every year for a total of 10 years.

This government scheme has been launched by the name of Senior Citizen Pension Scheme and is an initiative of the Life Insurance Corporation of India or LIC. This retirement scheme allows the elderly the benefit to opt for a regular pension plan on a regular basis, i.e., monthly, quarterly, half-yearly, or annually. All these retirement plans or pension plans are designed for people over 60 years of age.

Also Read: How to Find LIC Installment Premium Amount Without Tax

LIC’s 5 Retirement Saving Plans for Senior Citizens:

1. LIC New Jeevan Shanti

This is a multiple-investment option plan that only demands a single premium payment. Some of the main benefits of this scheme include:

  • Availability of loan facility after a year, basis on the investment option chosen
  • Fixed pension given at regular time periods for a lifetime with premium to be paid only one time
  • Premium entitled for tax rebate under Section 80CCC of the Income Tax Act

Eligibility Criteria for the plan: The minimum age for entry under the plan is 30 years and the maximum age is 79 years. The minimum amount to be invested under the plan is at least Rs. 1.5 lakh and there is no maximum limit for investment.

2. Pradhan Mantri Atal Pension Yojana

This plan has been specifically designed by the government for the unorganized section of the society, which includes home-based workers, wage laborers, or self-employed people. The plan guarantees financial security to all these people in old age. The key features of the plan include:

  • Upon turning 60 years old, the policyholder would be entitled to receive a fixed pension of the amount selected by them between Rs. 1,000 and Rs. 5,000.
  • The time period of contribution needs to be chosen by the policyholder or investor on the basis of the total pension amount selected for a minimum of at least 20 years.

Eligibility criteria for the scheme: The minimum age for entry into the plan is 18 years and the maximum age is 40 years. Persons in this age group can choose to invest in the scheme for at least 20 years, after which they’d be entitled to enjoy its benefits after the age of 60 years (old age).

3. Pradhan Mantri Vaya Vandana Yojana

This pension plan was introduced by LIC for the elderly in 2017. This government scheme is specifically meant for those aged over 60 years, guaranteeing them a rate of interest of 8% for a total of 10 years (which amounts to 8.3% per annum). According to this LIC Senior Citizen Pension Scheme 2022, the total amount invested in the plan is called the purchase price. Some of the major benefits of this plan include:

  • Guaranteed pension amount to the senior citizens for up to 10 years
  • A maximum investment of Rs. 15 lakh allowed to each senior citizen as against only Rs 7.5 lakh earlier
  • Guaranteed return of 8% rate of interest per annum on the investment made

Eligibility criteria for the plan: There is no maximum age limit for entering this plan. The government allows any person aged over 60 years to invest in the scheme.

4. LIC New Jeevan Nidhi

A unique retirement plan that not only assures pension payouts in the old age but also offers the additional benefits of savings to the elderly. Some of the major highlights of the plan are:

  • A high sum assured rebate at Rs. 3 lakh and more
  • Bonus benefits to investors who participate in investment in the scheme
  • A guaranteed addition of 5% for the first 5 years, after which a simple reversionary bonus and the final additional bonus are included from 6th year onwards
  • Choice to investors between regular premiums or single premium payments
  • Option to increase the plan coverage with add-on riders such as disability benefit and accidental death riders

Eligibility Criteria for the plan: The minimum age for entering the plan is 20 years and the maximum age is 58 years (in case of regular premium payment) and 60 years (in case of single premium payment).

5. LIC Varishtha Pension Bima Yojana

Yet another government scheme for the elderly that promises assured pension payments at regular intervals – monthly, quarterly, half-yearly, or annually. Some of the main benefits of this scheme are:

  • This particular plan can conveniently be joined with some other similar pension schemes to make for stable monthly income. A few examples include mutual funds, endowment plans, provident funds, and the like.
  • The plan allows for a refund of the purchase price to the policy’s beneficiary in case of death of the pensioner.
  • Tax exemptions are also provided on the premium amount payable, as per Section 80CCC of the Income Tax Act.

Eligibility criteria for the plan: The minimum age to opt for the plan is at 60 years and there is no maximum limit for entry age. The plan provides a minimum annuity payout of Rs. 6,000 and a maximum annuity payout of Rs. 60,000.

To Conclude

The government of India secures the financial interest of its senior citizens by way of introducing several pension schemes. The LIC India Senior Citizen Scheme is one such example. Most of these schemes come with the option to choose from monthly, quarterly, half-yearly, and annual pension payouts. The LIC Senior Citizen Monthly Income Scheme, for instance, assures a comfortable monthly income to the elderly in their golden retirement phase. You can choose a plan that suits your requirement best after careful consideration of each of them as detailed in this post.

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Aug 18, 2022
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