Once the salary stops, the question changes from “how do I grow my money?” to “how do I turn it into a dependable monthly income without running out?” No single product does everything well. Here is how the four most common options compare, using rates for October–December 2026.
At a glance
| SCSS | POMIS | Annuity | Debt fund (SWP) | |
|---|---|---|---|---|
| Return | 8.2%, fixed for 5 years | 7.4%, fixed for 5 years | Fixed for life, depends on age and option | Market-linked, not guaranteed |
| Payout | Quarterly | Monthly | Monthly, quarterly or yearly | Any amount, any frequency |
| Limit | ₹30 lakh per person | ₹9 lakh single, ₹15 lakh joint | None | None |
| Access to capital | Early exit with penalty | Early exit with penalty | Usually none | Anytime |
| Tax on income | At your slab rate | At your slab rate | At your slab rate | Gains at slab rate, only on what you withdraw |
| Safety | Government-backed | Government-backed | Depends on the insurer | Depends on the fund’s holdings |
Senior Citizens Savings Scheme (SCSS)
For most retirees aged 60 and above, SCSS is the first building block. It pays 8.2% for the October–December 2026 quarter, and the rate on the day you open the account stays fixed for the full five-year term. You can invest up to ₹30 lakh per person, so a couple can invest ₹30 lakh each. A full ₹30 lakh earns about ₹2.46 lakh a year, paid quarterly, or roughly ₹20,500 a month.
The interest is taxable. Under the old tax regime, the deposit qualifies for a deduction of up to ₹1.5 lakh and seniors can deduct up to ₹50,000 of interest; neither benefit is available in the new regime. TDS applies only if interest crosses ₹1 lakh a year.
Post Office Monthly Income Scheme (POMIS)
POMIS pays 7.4%, monthly, for five years, and is open to anyone, not just seniors. A ₹9 lakh single account pays about ₹5,550 a month. It is useful as a top-up once SCSS is full, or for a spouse below 60.
Annuities
An annuity from an insurer converts a lump sum into an income for life, so you cannot outlive it. The trade-offs are significant: the rate is locked for life and does not rise with inflation unless you choose (and pay for) an increasing option, the income is fully taxable, and in most plans you cannot get your capital back once you buy. Annuities make most sense for a portion of your money, bought in your late 60s or 70s when rates for your age are higher.
Debt funds with a systematic withdrawal plan
A systematic withdrawal plan (SWP) from a debt fund lets you take a fixed amount each month while the rest stays invested. You pay tax only on the gain portion of each withdrawal, at your slab rate, which can mean less tax in the early years than interest from a deposit. Returns are not guaranteed, so choose short-duration or liquid funds of good credit quality for this part of your money.
Putting it together: a simple bucket approach
- Bucket 1, the next 2 years of expenses: savings account, FDs and a liquid fund. This is your buffer so you never sell investments in a bad market.
- Bucket 2, years 3 to 10: SCSS and POMIS for guaranteed income, with debt funds for flexible withdrawals.
- Bucket 3, beyond 10 years: a modest share in balanced or equity funds so your money keeps up with inflation over a 25 to 30-year retirement.
Refill Bucket 1 from the others once a year. The right mix depends on your expenses, health, other income such as pension or rent, and how much you want to leave to your family.
Disclaimer: Rates and limits are as published for October–December 2026; rates for new deposits are reviewed every quarter, and scheme rules may change. Confirm current terms with the post office, bank or insurer before investing. This article is general education, not investment advice, and is not a recommendation of any product. Consult a SEBI-registered investment adviser before investing your retirement savings. Mungekar Wealth accepts no liability for any loss arising from reliance on this article.
