Time determines how you invest your money, and getting close to retirement changes your financial priorities. A senior person will likely invest in safer plans where returns are good enough to cover regular expenses. However, senior citizens today have multiple options for investment. There are private instruments and government schemes elderly can find helpful to generate decent returns.

Here are the 5 best investment options for senior citizens to maximise their income.
1. Senior Citizens Saving Scheme (SCSS)
SCSS is a government-backed investment scheme for senior citizens. If your age is 60 or above, you can invest your money and earn an interest of 7.4% pa in addition to the tax deduction benefit under Section 80C. This scheme has a 5-year term that can be extended by 3 years at the time of maturity. SCSS allows you to invest up to ₹15 lakhs. The interest earned on SCSS is subject to taxation at the applicable slab rate.
2. Bank FDs for Senior Citizens
Bank FDs are among the most popular investment instruments in India among senior citizens. When compared to regular FD instruments, most banks offer 0.25% to 1% higher interest on senior citizen FDs. Also, some banks currently offer interest rates of up to 8.75% for senior citizens. Besides, senior citizens can claim tax deductions of up to ₹50,000 under Section 80TTB on the interest income from banks, post office FDs, and cooperative banks.
You can invest your money in bank FDs with an interest reinvestment option and receive the entire corpus back in your account at the time of maturity, or you can choose to have the interest credited to your bank account every month and the invested principal in your account at the time of maturity. Bank FDs typically have a fixed interest rate, although some banks also offer FDs with floating interest rates. If the interest rate is expected to rise during the investment period, you may choose a floating rate FD. And if the interest rate is expected to fall in the near future, you should go for a fixed rate FD.
Sometimes, senior citizens may need immediate cash, but they don’t want to liquidate their investment before it reaches maturity. In that case, they can get a loan against FDs at interest rates as low as 1% to 2% above the interest rate on their pledged FD.
The Deposit Insurance and Credit Guarantee Corporation (DICGC) insures deposits (including principal and interest) in banks up to ₹5 lakhs. Therefore, to increase the safety of your funds, it’s best to spread your investment across multiple banks if your cumulative deposit (with interest) exceeds ₹5 lakhs.

3. Post Office Monthly Income Scheme (POMIS)
Senior citizens need a regular income from their corpus to meet their day-to-day expenses. Therefore, they can invest a portion of their corpus in the Post Office Monthly Income Scheme (POMIS), which will provide them with a regular monthly income. POMIS currently offers a 6.7% annual interest rate. It’s important to note that interest earned on POMIS is subject to taxation at the applicable slab rate.
4. Mutual Fund Schemes
Mutual funds offer several options for investors of all age groups. Senior citizens can invest in a Debt fund with a Fixed Maturity Plan (FMP), Monthly Income Plan (MIP), liquid fund, etc., as a low-risk option. In addition, mutual funds can be used for regular investment through lump-sum investments or SIPs.
As a senior citizen, if you invest your money in mutual funds, it will increase your returns while allowing you to diversify your portfolio and minimise risk.
5. Annuity Schemes
If you’re looking for a regular income and want to invest your money in a lump-sum corpus, then annuity schemes can be useful. An annuity scheme can provide an annual return of around 5.5% to 6.5% of the corpus. The returns on annuity schemes may not be very attractive, but they can be used as an alternative when the returns on other investment products are also at a similar level.
About Multipl
If you want to invest your money and save through mutual funds, the Multipl savings app is a great option. With Multipl, you can create goal-based investments, which means you can save and invest at the same time for a specific purpose.
The Multipl investment engine allocates the right assets and investment portfolio based on your duration, purpose, and risk profile so you can achieve your goal with maximum safety and liquidity. Besides, you can create other short-term and long-term savings goals like Vacation Goal, Gadget Goal, Retirement Savings Goal, Child’s Education Goal, and many more. On goal completion, you get exclusive brand benefits in the form of brand discounts. To learn more, download the app from Play Store/App Store.