Latest News
-
FREE, FREE, FREE! 3:1 Bonus: Pharma Stock Hits Back-To-Back Upper Circuits; 500 Shares To Earn Rs 1,69,500 -
1:10 Stock Split: Below Rs 10, Fertilizer Sector Turned Ex-Split; 8,282% Returns In 5 Years -
Rs 17/Share Dividend: Record Date On April 26; Buy The ICICI Group Stock To Be Eligible? -
Honasa Consumer to Strengthen Operations by Merging Fusion Cosmeceutics and Just4Kids -
Wipro Reports 7.8% Decline in Q4 Net Profit; CEO Highlights Economic Challenges -
IREDA Hits Record Annual PAT of Rs 1,252 Cr in FY24; Q4 Profits Up by 33% -
Massive Employee Exodus Hits India's Top IT Companies in FY23-24 -
Air India Enhances Operational Efficiency with New Crew Management System -
BlackRock Acquires Shares in Electrosteel Castings and PTC India for Rs 207 Crore -
IndiGo Enhances Domestic Routes with Direct Chennai-Durgapur Flights
LIC Varishtha Pension Bima Yojana: Not the best option for retired folk
Details of the scheme
a) Opening and closing
The scheme would run from August 15, 2014 until August 15, 2014.
b) Age requirements
If you are under 60 years of age, you are not permitted to invest in the scheme. The scheme would be for those over 60 years and above.
c) Payment period
The Pension payable would be on monthly, quarterly, half-yearly or annual mode.
d) Loan
One can avail a loan at 75 per cent only after three years of commencement.
e) Nominee
On death of the individual the amounts would be paid to the nominee.
Should one invest?
An interest rate of 9 per cent monthly is competitive, but, not the best rate around. You can get better yields from bank and quality company deposits. For example, Kerala Transport Development Finance Corporation offers a yield of as high as 11 per cent under its quarterly plans. Again, the deposits are very safe, since they are backed by the Government of Kerala.
The one advantage that LIC Varishtha Pension Bima Yojana would have is that you are guaranteed returns of 9 per cent per month for the next 15 years. So, you would gain if interest rates fall, but, would lose money if interest rates on deposits rise.
Again, the lock-in period of 15 years is not the best option, for a senior citizen. You can withdraw money only in case of a medical emergency. Also, the amount is taxable thus ensuring that it is not the best option around.
Here is a quick look at the disadvantages
1) Not the highest interest rates around.
2) Highly illiquid in case of emergency.
3) No tax benefits.
Conclusion
You can partially invest in the Scheme, while investing a part of your money in highly liquid schemes. Probably, you can look at strong bank fixed deposits that are willing to give you a quarterly interest rates. At least your money would be liquid and you could close the deposits at your will.
GoodReturns.in
