POMIS: Over the years, the Post Office Monthly Income Scheme (POMIS) has evolved into one of the most popular investment programmes for people of all ages. Account holders in the dependable government programme can expect a consistent monthly payment. Every month, the user’s savings account receives interest payments.
Members not only receive a consistent monthly income, but their initial investment is protected by a government-backed programme. When the five-year plan expires, the account holder receives a refund of their initial investment.
Setting up a recurring deposit (RD) with the same monthly payments from the monthly income plan can help an adult maximise total returns on savings account interest. Regular deposit accounts at the post office offer competitive rates of return. RD interest is compounded quarterly at 5.8 percent per year. At maturity, an investor will earn interest on both the MIS scheme and the RD on the Rs 4.5 lakh invested.
Calculation of the Post Office Monthly Income Scheme
Post Office Monthly Income Scheme calculation
Rs 4,50,000 (principal) + [Rs 2475 (interest per month ) x 60 months] = Rs 5,98,500 (Rs 4,50,000 + 148500 interest accrued)
60-month recurring deposit (5 years) at 5.40%
Rs 2475 Recurring Deposit for 60 Months = Investment Total Rs 2475 x 60 month = Rs 1,48,500 | Interest Earned = Rs 22,201
Return on RD = Rs 1,48,500 + Rs 22,201 = Rs 1,70,700
Features
Anyone who wants to invest in the Monthly Income Scheme can only make a single contribution of up to Rs. 4.50 lakh. A joint account may be formed in addition to opening the programme with a single Rs 9 lakh deposit. Interest will be paid on the closing date beginning on the first day of the month following the opening date and continuing monthly until maturity. The interest earned in a savings account is available for withdrawal at any time. However, keep in mind that if the account holder does not claim the monthly interest due, the interest will not accumulate.
You can close your account at any post office after 5 years by submitting a specific application form and your passbook. If the account holder dies before the account matures, the account may be terminated and the balance paid out to the beneficiary or nominee. Interest begins to accrue the month before the refund is issued.
