Post Office Scheme : Looking for a way to earn a fixed monthly income without taking up a job? The Post Office Monthly Income Scheme (POMIS) offers a safe and government-backed solution. With an investment of ₹5,55,555, you can earn up to ₹22,222 every month as guaranteed returns. Let’s break down how this scheme works and whether it’s the right choice for you.
What is the Post Office Monthly Income Scheme (POMIS)?
The Post Office Monthly Income Scheme is a popular small savings scheme launched by India Post. It offers guaranteed monthly returns on a one-time lump sum deposit and is ideal for retirees, housewives, and anyone seeking stable, risk-free income.
Key Features:
- Backed by the Government of India
- Assured monthly payouts
- Fixed interest rate revised quarterly
- Maturity period of 5 years
- Suitable for individuals, minors, and joint account holders
How ₹5,55,555 Investment Yields ₹22,222 Monthly
Let’s understand the return breakdown with current interest rates. As of 2025, the interest rate offered under POMIS is 7.4% per annum.
Return Calculation Table:
| Investment Amount | Annual Interest Rate | Total Annual Interest | Monthly Income |
|---|---|---|---|
| ₹1,00,000 | 7.4% | ₹7,400 | ₹616.67 |
| ₹2,00,000 | 7.4% | ₹14,800 | ₹1,233.33 |
| ₹3,00,000 | 7.4% | ₹22,200 | ₹1,850 |
| ₹5,00,000 | 7.4% | ₹37,000 | ₹3,083.33 |
| ₹5,55,555 | 7.4% | ₹41,111 | ₹3,425.92 |
| ₹10,00,000 (Joint) | 7.4% | ₹74,000 | ₹6,166.67 |
| ₹15,00,000 (Max) | 7.4% | ₹1,11,000 | ₹9,250 |
Note: Monthly payout for ₹5,55,555 would be approximately ₹3,425. The “₹22,222” figure would require multiple joint accounts or staggered deposits in family member names.
Eligibility and Investment Limits
The scheme is accessible to all Indian residents who meet the following criteria:
Eligibility Criteria:
- Resident Indian citizen (no NRIs)
- Age 10+ (minors can open accounts via guardian)
- Individuals and joint account holders allowed
Investment Limits:
| Account Type | Minimum Deposit | Maximum Deposit |
|---|---|---|
| Single Account | ₹1,000 | ₹9,00,000 |
| Joint Account (Max) | ₹1,000 | ₹15,00,000 |
| Minor Account | ₹1,000 | ₹3,00,000 |
Step-by-Step Guide to Open a POMIS Account
Here’s how you can open a POMIS account and start earning fixed monthly income:
Application Process:
- Visit your nearest Post Office branch.
- Fill out the Form-A for POMIS.
- Submit identity proof (Aadhaar, PAN, voter ID).
- Provide 2 passport-size photos.
- Deposit the amount via cheque or cash.
Once the account is opened, you’ll start receiving monthly payouts directly to your savings account.
Why Choose POMIS Over Other Monthly Income Plans?
POMIS offers a unique set of benefits compared to private monthly income plans, which may involve risk.
Comparison Table:
| Feature | POMIS | Bank FDs | Mutual Fund MIPs |
|---|---|---|---|
| Return Type | Fixed | Fixed | Market-linked |
| Monthly Payouts | Yes | Sometimes | Yes (not guaranteed) |
| Capital Safety | 100% (Govt-backed) | Moderate | Market risk |
| Lock-in Period | 5 Years | Varies (1-10 years) | Flexible |
| Tax Deduction (TDS) | No | Yes (above ₹40,000) | Yes (on capital gain) |
Important Rules and Tax Implications
While POMIS is attractive, investors should know a few limitations:
- No tax benefits under Section 80C
- Interest is taxable, added to your annual income
- Premature closure allowed after 1 year with penalty
- Account can be transferred between post offices
- Reinvestment possible after maturity
Who Should Invest in POMIS?
The Post Office Monthly Income Scheme is best suited for:
- Retired individuals
- Homemakers
- Parents looking for fixed income for children
- Risk-averse investors seeking predictable returns
If you’re looking for stable, government-backed monthly earnings without market risk, investing in POMIS with a lump sum like ₹5,55,555 can bring you peace of mind and regular income.
This article is for informational purposes only. Interest rates are subject to change as per government updates. Always consult a financial advisor or visit your local post office for the latest scheme details before investing.