5 investment options for senior citizens

Upon retirement, senior citizens need to plan their finances carefully so that the corpus they have created is able to provide them financial security in their retirement years as they have specific needs and goals. Here are some key avenues for them to consider.

Senior Citizens’Savings Scheme
The SCSS is available to individuals aged 60 and above. It is a safe option that offers attractive interest rates, guaranteed returns, fixed quarterly payouts and a fiveyear tenure. Each senior citizen can invest up to Rs.30 lakh in the scheme.


Fixed deposits
FDs are a popular choice due to their simplicity, reliability, steady returns and liquidity. Banks and post offices offer FDs with relatively higher interest rates for senior citizens.

Pradhan Mantri Vaya Vandana Yojana
The PMVVY is a government-backed insurancecum-pension scheme for senior citizens and is offered by the LIC. It provides a guaranteed return and regular monthly income for up to 10 years. However, it is currently closed for fresh subscriptions.

Mutual funds
Senior citizens may also invest in debt-oriented mutual funds or hybrid mutual funds. These primarily invest in fixedincome instruments and provide regular income along with the potential for capital appreciation. However, investing in such funds may be prone to risk and one should select the funds in alignment with their risk tolerance and investment objectives.

Post Office Monthly Income Scheme
Post Office MIS is offered by the Department of Posts and provides a fixed monthly income to investors. It has a maturity period of five years and the interest rates are revised quarterly.

Points to note

• While choosing an option, senior citizens should factor in tax implications, current liquidity, risk appetite and inflation.
• The investment plan needs to be reviewed periodically for any corrective measures needed.

Content on this page is courtesy Centre for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.