Post office monthly income schemes provide a monthly income at 8 per
cent per annum. On completion of six years, a 10 per cent bonus on the
principal sum is provided. The scheme offers better liquidity, with
investors having an exit option after one year from the investment date.
Unfortunately, an exit after one year would also lead to a loss of
5% of the amount invested. While there is no loss of interest earnings,
the loss of principal can be significant if the amount invested is high.
Investors have to wait for a three-year period to withdraw from the
scheme without penalty. The minimum investment for a single and joint
account is Rs.6000, while the maximum limit is Rs.300,000 for a single
account and Rs.600,000 for a joint account.
In short, it is suitable for people who wish to invest a lump-sum amount initially and earn interest on a monthly basis.
You can buy a post office MIS at any post-office in India.
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