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Difference between POMIS and LIC Akshaya Plan VI

POMIS is a post office savings scheme and LIC Jeevan Akshaya Plan VI is an annuity scheme

Kindly provide details as to what is the difference in POMIS and LIC Jeevan Akshaya Plan VI for a senior citizen, and for a person aged 45 years.
- R B Dwivedi

Post Office Monthly Income Scheme (POMIS) is a guaranteed return investment available at the post office. On the deposit that you make, you get an assured monthly income for five years. Currently, one earns 7.8 per cent interest per annum on the deposit, which is paid every month. The POMIS carries a maximum limit of ₹4.5 Lakh for an individual and ₹9 Lakh for joint accounts. So if you invest ₹4.5 lakh now, then you will get a monthly payout of ₹2925 for the next 5 years and at the end of the term you will get back your capital. Once you make the deposit you get the interest payout each month from the date of making the investment, not from start of the month. There will be no difference based on age. Whether a person joins at age 45 or at age 60 the scheme is the same for both.

LICs Jeevan Akshay VI Plan is an immediate annuity plan. Once you pay a one time premium, it will pay you a monthly or annual income at regular intervals as long as you live. The insurer also offers you an option of return of your premium at the end (which will fetch you lower monthly income). Unlike POMIS there is no upper limit on how much you can invest in this plan. You can choose to receive the payments monthly, quarterly, half yearly or yearly. While annuity guarantees you a fixed income as long as you live, the annuities are not inflation linked. The annuity rates differ according to the entry age of the person. For instance, if you start this plan at age 45 then for a ₹10 lakh premium you will get a monthly pension of approximately ₹6500. On the other hand if you start at the age of 60 for the pension will be a little higher approximately at ₹7700. Both the income from POMIS and LIC Jeevan Akshay are taxable in your hands.

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