Retirement income ladder
How much safe monthly income can my retirement corpus produce?
₹67,021 before tax, a blended 8.04% · 90% of what you need
| Rung | Amount | Rate | Per month | Term |
|---|---|---|---|---|
Senior Citizen Savings Scheme ₹30 lakh per person, two accounts; paid quarterly | ₹60,00,000 | 8.2% | ₹41,000 | 5 years, extendable 3 |
Post Office Monthly Income Scheme ₹15 lakh joint account; paid monthly | ₹15,00,000 | 7.4% | ₹9,250 | 5 years |
RBI Floating Rate Savings Bonds No cap; rate resets half-yearly at NSC + 0.35%; paid half-yearly | ₹25,00,000 | 8.05% | ₹16,771 | 7 years |
Rates in force from 2023-04-01; next small-savings revision due 1 October 2026.
How this is calculated
Rules checked against their sources on 29 September 2026. Tax year FY2026-27.
Safe income has a shape
Indian retirees have a set of government-backed instruments that pay fixed income, each with a cap or a term. Fill them in order of rate and safety and you get a ladder: the Senior Citizen Savings Scheme at the top (8.2%, ₹30 lakh per person, five years), the Post Office Monthly Income Scheme next (7.4%, ₹9 lakh single or ₹15 lakh joint, five years), then instruments without a cap: RBI Floating Rate Savings Bonds (NSC plus 0.35%, seven years, reset half-yearly), bank deposits with the senior-citizen premium, or an immediate annuity.
Two people, twice the room
The caps are per person. A couple who are both over 60 can hold ₹60 lakh in SCSS and a ₹15 lakh joint POMIS account, which at current rates produces about ₹50,000 a month before tax from ₹75 lakh, with no market risk. Spreading accounts across both names also uses two basic exemptions and two 80TTB deductions.
The tax
All of this interest is taxable at slab. Senior citizens get ₹50,000 of deposit interest tax-free under 80TTB in the old regime, and no TDS on deposit interest up to ₹1 lakh a year (or with Form 15H). A couple with only interest income of ₹6 lakh each pays almost nothing; a retiree with a pension and ₹12 lakh of interest pays at 20% or 30%. The calculator shows the income after tax at the slab you choose.
The flaw in the ladder
Every rung pays a fixed rupee amount. At 5.5% inflation, ₹50,000 a month buys what ₹29,000 buys today after ten years and ₹17,000 after twenty. A ladder should cover the floor of essential spending for the first decade; the money for the years after that has to grow, which means equity held through the ladder years. The SWP calculator and the retirement projection on this site take that side.
Rates change
Small-savings rates are notified every quarter and can fall; the RBI bond resets with NSC. Locking a five-year SCSS at 8.2% is worth something when rates are falling, and worth reconsidering when they are rising. The page prints the date of the rates it uses and the date of the next revision.
Questions people ask
- Who can open an SCSS account?
- Anyone aged 60 or over, or 55 to 60 if retired on superannuation or VRS (within a month of receiving the retirement benefits), or 50 for retired defence personnel. Up to ₹30 lakh per person, singly or jointly with a spouse; the joint account counts against the first holder's limit.
- How is SCSS interest paid?
- Quarterly, on the first working day of April, July, October and January, at the rate fixed when the account is opened, for five years. It can be extended by three years at the rate prevailing then. Premature closure carries a 1% to 1.5% penalty.
- What are RBI Floating Rate Savings Bonds?
- Government bonds sold through banks with no upper limit, seven years, interest paid half-yearly at the NSC rate plus 0.35% (8.05% now), reset every January and July. Not tradable; premature encashment only for seniors with a penalty. Fully taxable.
- Should I buy an annuity?
- An immediate annuity converts capital into lifetime income at 6% to 7.5% a year depending on age and options, and the capital is gone (unless you take return-of-purchase-price at a lower rate). It is the only rung that cannot run out, which makes a small one sensible for the floor; a large one loses to inflation. No product is recommended here.
- Why is my after-tax income lower than the gross?
- Interest from every rung is taxed at your slab. Seniors can deduct ₹50,000 under 80TTB in the old regime, and can avoid TDS with Form 15H when total income is below the taxable limit; the tax itself still depends on your total income for the year.
Want the whole picture?
A free Eazyretire plan puts this number next to your income, savings and spending and tells you whether your money lasts to the age you plan for, and what to change if it will not.