Senior citizens can exclusively get some financial benefits that they may not always be aware of. Senior Citizens are those who are of the age of 60 and above. There is the Senior Citizen Saving Scheme exclusively available for this category of investors. This is a deposit plan of 5 years with post offices and public sector banks and is a safe investment. The interest rates are presently 8.3% per annum and interest is paid out quarterly. However, the upper limit for investing in this scheme is Rs. 15 lakh for one senior citizen. This investment option is available to all senior citizens, even those in the highest tax brackets.
Most public and private sector banks have additional interest rates for senior citizens on deposits. These usually range between 0.25-0.50% per annum. The Varishth Pension Beema Yojana product from LIC has been launched last year and the maximum investment amount for this scheme is Rs. 7.5 lakh for every senior citizen. The Union Budget of 2018 has proposed an increase in this amount to Rs. 15 lakh. The monthly pension will stand at Rs. 10, 000 with the higher limit. The interest can be taken on a quarterly, monthly, annual or half-yearly basis. There is also zero medical checkup needs for this plan and this is an immediate annuity plan. There is flexibility for surrendering the policy early in case of the senior citizen has any terminal/critical illness to deal with.
The Varishth Mediclaim Policy has also been launched by National Insurance Company and the maximum coverage for hospitalization is Rs. 1 lakh per individual and Rs. 2 lakh for critical illness per senior citizen. The policy renewal takes place till a maximum of 90 years of age. The benefits include costs of diagnostic charges, medicines, blood and oxygen among others. There are emergency ambulance charges covered up to Rs. 1, 000 annually.
The tax categories for senior citizens are between 60-80 years and for super senior citizens it is above 80 years. The minimum exemption limit is Rs. 3 lakh for senior citizens and super senior citizens do not have to pay any taxes unless their annual income crosses Rs. 5 lakhs. All senior citizens have an extra concession annually of Rs. 5, 000 and super senior citizens have Rs. 25, 000 as an additional concession annually.
Section 80D offers deductions on health insurance premium. The maximum deduction under this section is now Rs. 50, 000 for senior citizens. Under Section 80 DDB, senior citizens can get deductions up to Rs. 100, 000 for specific diseases like malignant cancer, AIDS, neurological ailments and other highly critical illnesses. Under Section 80 TTB, senior citizens get interest which is tax free on bank fixed deposits, recurring deposits, savings accounts and post office deposits up to maximum limits of Rs. 50, 000 annually. Air India also offers 50% discounts on air travel domestically for senior citizens while the Indian Railways offers discounts of 50% and 40% for women and men for all trains including the Shatabdi and Rajdhani. In fact, even MTNL and BSNL offer priority for senior citizens with regard to registering telephones and there are discounts on the monthly service charges and charges for installation as well.