If you’re looking for a secure, government-backed investment that provides guaranteed monthly income, the Post Office Monthly Income Scheme (MIS) is one of the best available options in India.
In this blog, we explain how a one-time investment in the Post Office MIS can give you monthly returns of ₹9,250 for five years, who can invest in it, how the interest is calculated, and why this scheme is ideal for retirees, homemakers, and anyone seeking passive income without taking risks.
🏦 What is the Post Office Monthly Income Scheme (MIS)?
The Post Office MIS is a small savings scheme run by India Post under the Ministry of Finance. It provides a fixed monthly income by offering interest on a lump sum deposit for a 5-year term.
🔹 Key Features:
- Type: Fixed income scheme
- Lock-in Period: 5 years
- Interest Payout: Monthly
- Current Interest Rate (July–September 2025): 7.4% per annum
- Minimum Investment: ₹1,000
- Maximum Investment: ₹9 lakh (single), ₹15 lakh (joint)
💰 How to Earn ₹9,250 Per Month?
Let’s understand how you can earn ₹9,250 monthly from a one-time investment under this scheme.
✅ Monthly Income Calculation:
- Current Interest Rate: 7.4% annually
- To earn ₹9,250 per month = ₹1,11,000 per year in interest
- Total investment needed = ₹15,00,000 (maximum limit under joint account)
- Monthly interest = (₹15,00,000 × 7.4%) ÷ 12 = ₹9,250
📝 Summary:
- One-time investment: ₹15 lakh (joint account)
- Monthly income: ₹9,250
- Tenure: 5 years
- Total interest earned in 5 years: ₹5,55,000
- Principal refund after maturity: ₹15,00,000
You get ₹9,250 every month for 60 months, and after 5 years, your entire capital is returned.
👥 Who Can Invest in Post Office MIS?
✅ Eligible Investors:
- Resident Indian individuals
- Single adults (above 18 years)
- Joint accounts (up to 3 persons)
- Guardians on behalf of minors
❌ Not Eligible:
- Non-Resident Indians (NRIs)
- Hindu Undivided Families (HUFs)
📑 Account Types and Limits
| Account Type | Maximum Investment |
|---|---|
| Single Account | ₹9,00,000 |
| Joint Account (2-3) | ₹15,00,000 |
| Minor Account | ₹3,00,000 |
Each individual can hold both single and joint accounts, but the combined limit must not exceed ₹9 lakh.
🔁 Interest Payment and Mode
- Interest is paid monthly, starting from one month after deposit.
- Payment is made via Post Office savings account, ECS, or auto-credit.
- Unclaimed interest is not compounded, but can be withdrawn later.
- If interest is not withdrawn monthly, it doesn’t earn extra.
📈 Interest Rate Trends
The interest rate is revised every quarter by the Ministry of Finance. As of Q2 FY 2025–26 (July–September 2025), the rate is 7.4% per annum.
Historical rates have ranged between 6.6% to 8.4%, making it one of the most stable fixed-income options.
🧾 Tax Implications
- Investment in MIS is not eligible for Section 80C deduction.
- Interest earned is taxable as per your income tax slab.
- No TDS is deducted by the post office.
- You need to declare interest as “Income from Other Sources” while filing ITR.
🛠️ Premature Withdrawal Rules
While MIS is a 5-year scheme, premature closure is allowed under certain conditions:
| Period of Closure | Penalty |
|---|---|
| Before 1 year | Not allowed |
| After 1 year but before 3 years | 2% of principal deducted |
| After 3 years but before 5 years | 1% of principal deducted |
Interest will be paid only up to the month before account closure.
🧾 How to Open a Post Office MIS Account?
You can open a MIS account by visiting your nearest Post Office branch. The process is simple and documentation is minimal.
📋 Documents Required:
- Aadhaar card
- PAN card
- Passport-sized photographs
- Post Office savings account (mandatory)
- Filled MIS application form
You can also set up monthly interest auto-transfer to your Post Office or bank savings account.
🎯 Who Should Invest in MIS?
The Post Office MIS is best suited for:
✅ Senior citizens looking for monthly pension-like income
✅ Homemakers who want regular cash flow
✅ Conservative investors avoiding risky market instruments
✅ Parents planning for children’s fixed expenses
✅ Anyone seeking a guaranteed income plan for a medium-term goal
💡 Key Benefits of Post Office MIS
- ✅ Assured monthly income
- ✅ Government-backed scheme = no risk
- ✅ Simple to understand and operate
- ✅ No TDS deductions
- ✅ Can be used to supplement pension or salary
- ✅ Option to reinvest maturity amount in other schemes like SCSS or POMIS again
⚠️ Things to Keep in Mind
- Interest is not tax-free
- No compounding benefit (monthly interest is fixed)
- No liquidity before 1 year
- Returns are fixed, so no scope for growth like mutual funds or equities
- Cannot be opened or operated online yet
📦 Maturity and Reinvestment Options
At the end of 5 years, your principal is refunded. You can then choose to:
- Reinvest in another MIS account
- Transfer funds to Senior Citizen Savings Scheme (SCSS) if eligible
- Move the corpus to Post Office FD or Savings Account
✅ Final Words: Should You Invest?
The Post Office Monthly Income Scheme is a reliable and stress-free investment for those who prioritize guaranteed, monthly cash flow over high returns.
If you have a lump sum — say ₹15 lakh — and want to ensure ₹9,250 per month without touching your capital, this scheme is a perfect fit. It may not offer inflation-beating returns, but it provides peace of mind and consistent income, which is priceless for retirees and risk-averse investors.
Secure your tomorrow with a one-time investment today — the Post Office MIS is simple, safe, and dependable. 💸📮