# New Pension Plan 

Based on the success and popularity of the Varishtha Pension Bima Yojana 2003 (VPBY-2003) and Varishtha Pension Bima Yojana 2014 (VPBY-2014) schemes, it was decided to launch a simplified scheme of assured pension of 8% called the Pradhan Mantri Vaya Vandana Yojana to protect elderly people aged 60 years and above against a future fall in their interest income due to uncertain market conditions, as well as to provide social security during old age.

# What is Pradhan Mantri Vaya Vandana Yojana (PMVVY) ?

The Indian government has introduced the Pradhan Mantri Vaya Vandana Yojana (PMVVY), a retirement benefit programme. The programme was introduced in May 2017 and is government-subsidised. The purchase price of the scheme is the sum of money that the buyers invested. The system gives a secured level of profitability since the government guarantees it. The programme gives out regular pensions on a monthly, quarterly, half-yearly, or annual basis. The PMVVY is a great substitute for conventional deposit accounts.

# Eligibility for PMVVY

* The only need for participation in the PMVVY scheme is that subscription be a retiree, i.e. (above the age of 60 years).
* The candidate should be a citizen of India.
* The PMVVY plan has no upper age limit for enrollment.
* The client must be prepared to take advantage of the 10 policy terms.

# The following are the minimum pension amounts offered under the PMVVY:

* Rs 1,000 per month
* Rs 3,000 per quarter
* Rs 6,000 per half year
* Rs 12,000 per year


# The following are the maximum pension amounts offered under the PMVVY:

* Rs 9,250 per month
* Rs 27,750 per quarter
* Rs 55,500 per half year
* Rs 1,11,000 per year 


# PMVVY Scheme Term and Pension Payment -

This elderly people' programme is available for 10 years. Depending on the type the buyer selects, pension payments under PMVVY may be made monthly, quarterly, half-yearly, or annually. The very first pension payment under PMVVY begins one year, six months, three months, or one month after the programme was purchased. For instance, if you choose the monthly payment option for your pension and purchase the program now, your retirement will begin after one month.


# Return under PMVVY 

The government offers a return of 7.4% p.a. through the Pradhan Mantri Vaya Vandana Yojana (PMVVY), which is payable monthly. If you choose a monthly pension plan, the annual rate of interest of 7.4% translates to 7.66% per annum. The program doesn't incur any GST or service charges because it effectively functions as a pension plan.

The program, though, is not eligible for earnings tax relief. The earnings are taxed. The Indian government would be responsible for covering the difference between the income that the LIC generates and the 7.4% guaranteed. The difference will be paid to LIC by the national govt as a premium.


# Benefits of Pradhan Mantri Vaya Vandana Yojana

1. The retirement plan provides 7.4% annual returns, which are due every month for ten years.
2. The pension is paid in arrears at the conclusion of each phase for the whole ten-year plan duration. Payments are paid as chosen by the pensioner: monthly, quarterly, half-yearly, or annually.
3. At the conclusion of the policy's 10-year term, if the retiree lives, the entire sum, such as the purchase cost and last pension instalment, is paid.
4. After three years into the programme, loans up to 75% of the Principle Price may be approved in a crisis. The loan balance is collected from claims profits, while the income is collected from pension instalments.

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Pradhan Mantri Vaya Vandana Yojana

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