Whenever we talk about the leading banks in India, the State Bank of India is always registered in the minds of one and all for its endless services to generations. They have a legacy of over 200 years, which developed the phenomena of trusteeship among the Indians.
SBI (State Bank of India) offers multiple policies and schemes to their bank account holders. So one of the schemes they offer is MIS (Monthly Income Scheme) for people who want safe and sound investment options with promising returns. Under this scheme, the consumer gets the interest paid monthly.
How does SBI monthly income scheme work?
SBI monthly income plan is designed to make fixed monthly income to the investor, making them financially secure in the future. This feature attracts people who want a steady income to lead their lives. SBI monthly income scheme works around the key parameters that are stated below.
- SBI MIS interest rate
The investors must deposit a minimum of RS 1,000, multiples of Rs 1,000 thereafter. And a maximum investment limit is INR 4.5 lakh for a single account holder and INR 9 lakh for a joint account holder. The SBI monthly income scheme will provide a significant advantage to its investors through the SBI MIS interest rate. The SBI MIS scheme offers the interest rate through the structured EMI (Equated Monthly Installment) method. Under the SBI MIS interest rates are similar to the Interest rate applicable to Term deposits and Fixed Deposit schemes.
- SBI MIS Calculator
SBI MIS Calculator is a tool that can assist you in calculating the interest earned and the maturity amount for your investment in the SBI MIS scheme. The calculator considers the investment amount, tenure, and interest rate to estimate the returns you can expect from the scheme. This tool is designed to plan your investments and compare the returns offered by different schemes.
- Tenure
SBI monthly income scheme offers the SBI MIS interest rate for different time intervals like three years, five years, seven years, and ten years. People can enrol themselves, as per their choice of plan. The percentage of interest rates varies as per the different maturity periods.
- Taxation
The interest amount earned on the SBI monthly income scheme is taxable, and the bank in which your interest amount is received deducts TDS (Tax deducted at source) at the current rate.
- Premature Withdrawal
In the premature withdrawal of the deposited amount, the investor will be liable to pay the penalty because the investor is withdrawing the money before the maturity date as per the guidelines of the Bank.
- Risk Factor
SBI MIS is a great investment option for investors who want to earn from their investments regularly and without risk factors.
Is there any eligibility to get enrolled under the SBI MIS scheme?
There is an eligibility criterion to get enrolled under this SBI fixed deposit monthly scheme.
- The applicant should be a citizen of India and must be 18 years old.
- The scheme is available for the individual account holder or the joint account holder, and the minor can also enrol himself under this scheme but with a guardian.
- The maximum amount you can invest is Rs. 4.5 Lakh in a single account, and for a Joint account, the amount is Rs 9 lakhs.
What is SBI fixed deposit monthly income scheme?
SBI fixed deposit monthly income scheme is a type of fixed deposit plan where the investor can deposit a lump sum amount in an FD and opt for monthly interest as interest income. The interest rate for SBI FD-MIS is usually higher than that offered on regular FDs, though it is subject to change as per the market conditions.
SBI fixed deposit Monthly Income Scheme Calculator
SBI fixed deposit monthly income scheme calculator calculates the monthly interest earned from an FD. The investor can use an FD interest calculator to determine how much interest will be payable on the amount deposited at the end of each month. The BondsIndia FD interest calculator is quite an easy tool to calculate the interest earned on fixed deposit investments.
Why SBI monthly scheme is vital for Senior citizens?
SBI Monthly Income Scheme (MIS) is vital for senior citizens, or we can say it is designed typically for them because it provides a convenient and reliable source of income without compelling them to take any risks. Here are the reasons why SBI MIS is highly beneficial for senior citizens
- Regular income: Senior citizens who retire or are no longer working may not have a regular source of income. SBI’s monthly income scheme provides a fixed monthly payment, which can help them meet their expenses in their daily lives along with maintaining their living standard.
- Safe investment: The SBI monthly income scheme is a safe investment option provided by the State Bank of India, which is a government-owned bank. The principal also remains safe at maturity and returns to the investment at the tenure’s end, making it a low-risk investment.
- Guaranteed returns: SBI MIS for senior citizens, the interest rate offered is 7.40%, and it does not change at the time of investment and during the tenure. Due to this situation, senior citizens can avail guaranteed return on their investment.
- Tax benefits: Senior citizens have tax exemption under the Income Tax Act, which allows them to claim an amount of up to Rs. 50,000 on the interest earned from the SBI monthly income scheme.
- Easy to open and manage: Senior citizens can easily open and manage SBI monthly income scheme. They can easily visit the nearest SBI branch or use the online banking facility and can solve all their queries to open an account and manage their investments.
Eligibility Criteria to Invest in SBI monthly income scheme for Senior Citizens
- To avail of the benefits of the SBI MIS scheme for senior citizens, the eligibility criteria are as follows.
- The investor’s age limit should be at least 60 years.
- If any investor has taken VRS or is retired with superannuation, then he/she is eligible to avail of the benefits of the SBI Senior Citizen Savings Scheme, but with the condition that the investor should be more than 55 years and less than 60 years.
- Retired defence service personnel are also eligible to opt to invest in this scheme if he/she has attained the age of 50 years.
- Hindu Undivided Family Members and NRIs (Non-Resident Indians) are not eligible to open an account with SBI monthly income scheme.
What are the documents required to register for SBI MIS for Senior Citizens?
Senior citizens can open their accounts under SBI MIS for senior citizens scheme in any branch of the SBI Bank. India. They need to provide the following documents, which are stated below.
- Passport size photo.
- For age proof – Birth certificate proof/ Voter card
- Address proof – Aadhar card/ Voter Card/ Electricity Bill etc
- ID proof – Passport, Pan card
- Form A
Is SBI monthly income scheme and the SBI annuity deposit scheme different?
Yes, there are major differences between them. They are basically two different options offered by the State Bank of India for investments.
SBI MIS scheme is a saving-enhancing scheme that offers fixed income every month for a period of time, as per the plan chosen by the investor. However, the interest rate fluctuates depending on the amount invested and as per the market condition.
On the contrary, the SBI annuity deposit scheme is an investment plan where the investor makes a lump sum deposit and receives monthly payments in the form of an annuity for a fixed period based on the principal amount and current interest rate. Normally, the interest rate offered on the SBI annuity deposit scheme is comparatively higher than the other regular monthly income schemes. Under this scheme, the interest rate offered depends upon the term of the deposit, which means for how long the investor is depositing his/her money.
What is Post Office Monthly Income Scheme?
Any adult, whether married or single, anyone who has a joint account or any minor under his guardian can open a Post Office Monthly Income Scheme Account. The minimum amount needed by the investor to open the account is ₹1000. For single account holders, the maximum amount that can be invested is Rs. 4.5 lakhs and Rs. 9 lakhs for joint account holders. Under the Post Office MIS scheme, the investor has to pay the tax interest rate they receive annually (no additional benefit for senior citizens) every month, starting from the date of account opening and continuing until the maturity period.
The nominee will get the deposit amount if the account holder passes away before the account’s maturity. The deposited amount cannot be withdrawn prematurely before the date of maturity. A 2 per cent penalty is applicable on the withdrawer after the first year of account opening for premature withdrawals. The post office applies a 1% penalty for withdrawals made after the third year but before the fifth year. Some investors prefer to invest in the Post Office Monthly Income Scheme over SBI Monthly Income Scheme because they trust more in the Post Office services and the schemes offered by it.
Which are popular monthly income schemes in India to Invest in?
There are a few popular monthly income schemes for the citizens of India can invest in
- Post Office monthly income scheme – Many consider the Indian Post Office’s monthly income scheme a significant investment. The amount of risk associated with this investment is very low, as the government backs it. Currently, the POMIS offers 7.1% annual interest due each month. The plan has a five-year deposit period. The maximum amount an individual can contribute is Rs.4,50,000, while the maximum amount for joint investment is Rs.9,00,000. The minimum investment in this plan is only Rs.1,500.
- Senior Citizen Saving Scheme – This scheme is beneficial for the retired population of India. This scheme will provide them with monthly income. This scheme allows many senior citizens to invest without concern and as it is government-supported. Some post offices and banks like SBI offer this savings scheme service.
- Monthly Income Plan - Under the monthly Income Plan, the investor invests primarily in fixed income and just a small amount in equity and securities. The fund’s performance will decide the amount to be given to the investors, which is not fixed. The returns are not guaranteed because they are based on mutual fund performance.
Conclusion
In the end, multiple schemes and investment options are available in the market for people of all age groups. It is up to you in which scheme you want to invest your hard-earned money by calculating all the essential factors involved in it. Also, there is always risk involved in the return on your investment because the interest rate is never constant.
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