An overview of Pradhan Mantri Vaya Vandana Yojana (PMVVY)

What is Pradhan Mantri Vaya Vandana Yojana scheme? Prime Minister Narendra Modi announced his intention to launch a scheme for senior citizens in his New Year's eve address in 2016. This eventually crystallised into Pradhan Mantri Vaya Vandana Yojana (PMVVY). The scheme (though marketed as a pension) is essentially a fixed deposit with LIC and has a guaranteed interest rate of 7.4 per cent (for FY 2021-22) for a period of 10 years. Effective from FY 2020-21, annual reset of rate of return will occur in every FY. But the interest rate will remain constant for you for the entire tenure of the scheme. On the expiry of this term, you will get your principal back. Features of Pradhan Mantri Vaya Vandana Yojana Eligibility: You must be 60 years of age or above Investment: Minimum Rs 1.57 lakh. Maximum Rs 15 lakh. Tenure: 10 years Other features: Premature exit is available in the case of a critical illness. 98% of the deposit will be refunded

This article was originally published on January 05, 2022.