Pradhan Mantri Vaya Vandana Yojana: Benefits, Purchase Price & Free Look Period
Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a government-sponsored pension scheme meant exclusively for senior citizens aged 60 and above. The scheme, which was first made available in 2017, is now valid up to 2023. With the scheme, the government aims to provide financial security to senior citizens and help them meet their old age expenses. To avail of the scheme, senior citizens can approach any licenced life insurance company or public sector bank.
PMVVY Scheme Benefits
In 2020-21 and thereafter, PMVVY provides an assurance of 7.40% returns. As part of the scheme, policies purchased by 31st March, 2022 will also receive an agreed pension of 7.40% p.a payable monthly. The scheme is designed to provide social security in old age and is therefore an important scheme for senior citizens.
Pension payments are made at the end of each covered period, during which you have been covered by your policy. This means that if it’s monthly payments then they’ll come every month. You can also choose between quarterly or half-yearly coverage – this way there are less gaps in between paychecks without any risk involved.
The government has exempted this plan from GST, so you don’t have to worry about any tax burden on your retirement savings.
More to Know About the Scheme
The bank loans up to 75% of the purchase price, with an option for a three-year mortgage. The interest on these mortgages can come from either pension payments or claim proceeds; they are recoverable at any time after one year’s repayments have been made without penalty.
The plan also provides for early retirement from work to take care of a critically ill family member or self. On these premature withdrawals, 98% is refunded back into your account. The insurance policy term is 10 years and on the death of a pensioner during this time, the spouse will be compensated. The purchase price can also accommodate any other eligible family members as well so long as they are present within your household!
Eligibility
| Min Entry Age | Sixty Years |
| Max. Entry Age | No Age Limit |
| Policy Time | Ten Years |
| Investment Limit | Rs 15 lakh per senior citizen |
| Minimum Pension | Rs. 1k/- per month
Rs. 3k/- per quarter Rs. 6k/- per half-year Rs.12k/- per year. Inve |
| Maximum Pension | Rs. 9.25k/- per month
Rs. 27.75k/- per quarter Rs. 55.5k/- per half-year Rs. 1 Lac 11k/- per year |
Payment of Purchase Price
The purchase price can be paid in a single payment or over time. You have the option of choosing how much money you want for your pension as well, with options ranging from:
| Pension Mode | Min. Purchase Price | Max. Purchase Price |
| Yearly | Rs. 1,56,658/- | Rs. 1,449,086/ |
| Monthly | Rs. 1,62,162/- | Rs. 15,00,000/- |
Free Look Period
Free Look period is a fancy way of saying you can cancel your policy with no strings attached. If the customer doesn’t like what they see in terms & conditions, all he or she needs to do it return within 15 working days (a month in case bought online) after receiving their enrollments notice for an full refund including tax on initial deposit-stamp duty paid already spent as well any PPS payment made towards retirement plans at work
Final Say
The Pradhan Mantri Vaya Vandana Yojana is a great scheme that offers elderly citizens a monthly income during their retirement years. It’s important to note, however, that there are some eligibility requirements that must be met in order to qualify for the program. If you’re an elderly citizen and would like more information on the Pradhan Mantri Vaya Vandana Yojana, please visit the official website or speak to your local bank representative.
