POMIS vs SWP: Best Monthly Income Plan for Retirees in India
Planning for financial stability becomes all the more important once regular pay checks stop.
As we age, the cost of living doesn’t slow down—in fact, healthcare, medication, and day-to-day expenses often rise.
So, how do you ensure a steady income that keeps up with life’s needs, without taking on too much risk? Two popular options often come up in this conversation:
The Post Office Monthly Income Scheme (POMIS) and the Systematic Withdrawal Plan (SWP) through mutual funds. But which one truly supports your lifestyle, comforts, and peace of mind during retirement?
In this article, we’ll walk you through both choices—clearly, calmly, and with examples—so you can see what fits best for your future. Because when it comes to your golden years, shouldn’t your money work just as hard for you as you did to earn it?
The Post Office Monthly Income Scheme (POMIS) is a government-supported savings plan built for those who value stability and predictability, especially retirees.
It’s backed by the Ministry of Finance, which means your capital stays protected, and the monthly pay-outs are fixed right from the start.
For anyone who prefers peace of mind over market swings, POMIS serves as a reliable option to ensure regular income without taking unnecessary risks.
POMIS is particularly suitable for those searching for the best monthly interest plan with zero market dependency.
If you’re wondering what is POMIS scheme in post office, it’s a fixed-income product offering guaranteed monthly returns, ideal for low-risk retirement planning.
i. Safety of Capital: As a government-backed scheme, your investment remains secure until maturity.
ii. Investment Limits:
iii. Tenure: Fixed investment period of 5 years:
iv. Monthly Income: Earn interest income every month, which can be:
v. New Feature: Investors now have the option to transfer monthly interest to a Post Office Recurring Deposit (RD) account for further savings.
POMIS lock-in period of 5 years makes it suitable for medium-term goals like children’s school fees or healthcare.
Using a POMIS interest calculator can help retirees estimate their fixed monthly earnings beforehand.
In case of emergencies, POMIS premature withdrawal is allowed with a nominal penalty—making it more flexible than many other fixed-income schemes.
POMIS benefits conservative investors by offering predictable monthly income without worrying about market volatility.
For those wondering “is POMIS tax-free?” – the answer is no. POMIS returns are taxable as per your slab.
A Systematic Withdrawal Plan (SWP) is a flexible feature offered by mutual funds that allows you to withdraw a fixed amount at regular intervals—monthly, quarterly, or annually.
It’s especially helpful for those looking to create a steady income stream during retirement. Think of it as drawing a pay check from your own investments.
The AMC (Asset Management Company) credits the chosen amount directly to your bank account, while the rest of your money stays invested—continuing to grow, depending on how the market performs.
It’s a thoughtful way to balance income needs with long-term growth.
If you’re looking for the best SWP plan in India 2025, equity-debt hybrid mutual funds with low volatility could be a great fit for monthly withdrawals.
Post office SWP scheme doesn’t exist officially, but mutual funds offer true SWP functionality with higher flexibility and return potential.
For retirees comparing SWP vs MIS, SWP allows growth potential but comes with market risk, while POMIS offers safety with fixed income.
Unlike POMIS scheme in post office, mutual fund SWPs do not guarantee fixed income, which could be a concern for ultra-conservative investors.
While SWP vs MIS comparisons often favour MIS for safety, SWPs are ideal for those seeking growth with income.
Now that we’ve seen what both POMIS and SWP bring to the table, let’s look at how they might work in real life. Imagine this: you have a lump sum of ₹15 lakhs and you’re looking to turn it into a steady monthly income.
What’s the smarter move—locking it into POMIS for fixed interest or choosing an SWP that offers income with a chance for growth? To help you decide, let’s walk through two simple scenarios: one with POMIS, the other with a mutual fund SWP.
| POMIS | 15,00,000 |
|---|---|
| CAGR | 7.40% |
| Tenure (Years) | 5 |
| Annual Interest | 1,11,000 |
| Monthly Interest | 9,250 |
| Final cash in hand at the end of 5 years | 15,00,000 |
With POMIS, the investor receives a fixed ₹9,250 every month for five years. The original ₹15 lakhs stays safe and is returned in full at the end of the term. For someone who prioritises security and predictable income, this setup feels reassuring.
But here’s the catch—while the income is steady, it’s also static. The scheme doesn’t adjust for inflation, so over time, that ₹9,250 may not stretch as far, especially as living costs rise.
And since the funds are locked in, there’s limited flexibility if your financial needs change mid-way.
The POMIS lock-in period of 5 years limits liquidity, making it less flexible than SWP plans in mutual funds.
The post office monthly income scheme (POMIS) offers guaranteed returns but lacks inflation protection.
To replicate the ₹9,250 monthly income, the lump sum is split between equity and debt:
| Mutual Fund Investment | Equity | Debt |
|---|---|---|
| Investment Amount | 10,20,000 | 4,80,000 |
| CAGR | 12% | 7% |
| Tenure (Years) | 5 | 5 |
| SWP (Monthly) | NIL | 9250 |
| Final Value | ₹ 17,97,588.52 | ₹ 10,939.54 |
| Final cash in hand at the end of 5 years | ₹ 18,08,528.06 | |
In the SWP strategy, the debt portion takes care of the monthly income—₹9,250 for five years—while the equity component quietly works in the background.
By the end of the term, the debt pool is nearly exhausted (just ₹10,000 left), but the equity portion has grown to an impressive ₹17.97 lakhs.
Altogether, the investor walks away with ₹18.08 lakhs—more than the original capital. It’s a smart blend of stability and growth, offering regular income today without compromising the potential to build wealth for tomorrow.
SWP in post office doesn’t currently exist like mutual fund SWP, making mutual funds a more versatile choice for long-term wealth.
SWP scheme in post office is a common misconception—POMIS works differently from mutual fund SWP structures.
| Final cash in hand at the end of 5 years | 15,00,000 |
|---|---|
| POMIS | 15,00,000 |
| CAGR | 7.40% |
| Tenure (Years) | 5 |
| Annual Interest | 1,11,000 |
| Monthly Interest | 9,250 |
| Final cash in hand at the end of 110 years | 15,00,000 |
By reinvesting in POMIS, the investor continues to receive the same ₹9,250 every month—reliable, yes, but unchanging. While this fixed income may feel sufficient today, what about five years down the line?
As living costs rise with inflation, the same amount begins to stretch thinner, slowly chipping away at the comfort and security it once provided. That’s the quiet drawback of fixed-income plans—what feels enough now may not feel the same tomorrow.
According to the latest post office POMIS interest rate 2025, returns remain static despite inflation pressures.
POMIS benefits include capital safety and assured income, but they lack adaptability compared to dynamic SWP plans.
Thanks to the earlier SWP strategy, the investor now has ₹18.08 lakhs at the end of 5 years.
Recognising that prices don’t stay still—inflation is a silent expense—the investor wisely adjusts the withdrawal amount to ₹9,805 per month, accounting for an estimated 6% rise in cost of living.
This simple step keeps the income aligned with real-world expenses, ensuring that financial comfort continues without compromising lifestyle. It’s not just about drawing money—it’s about drawing it right.
The best SWP plan in India 2025 would likely include a mix of equity and debt funds to allow inflation-adjusted withdrawals.
Monthly withdrawal plan post office options like POMIS lack the step-up flexibility that SWP offers for increasing expenses like school fees.
Using a POMIS calculator or SWP calculator can help you simulate and compare returns before committing to a plan.
| Final cash in hand at the end of 5 years | ₹ 18,08,528.06 | |
|---|---|---|
| Equity | Debt | |
| Investment Amount | 11,21,287 | 5,06,388 |
| CAGR | 12% | 7% |
| Tenure (Years) | 5 | 5 |
| SWP (Monthly) | NIL | 9805 |
| Final Value | ₹ 19,76,091.52 | ₹ 8,212.76 |
| Final cash in hand at the end of 10 years | ₹ 19,84,304.28 | |
The beauty of this blended approach lies in balance. The debt portion cushions the need for inflation-adjusted monthly income, providing stability.
Meanwhile, the equity portion quietly continues its upward journey, harnessing the power of compounding over time.
After 10 years, the investor not only manages consistent withdrawals but also ends up with ₹19.84 lakhs—growing the original capital while meeting living expenses. It’s a reassuring outcome: income today, growth for tomorrow.
Among the best SWP plans in India, this kind of debt-equity hybrid offers both income and capital appreciation—something fixed instruments like POMIS can’t match.
| Feature | POMIS | SWP in Mutual Funds |
|---|---|---|
| Capital Protection | Yes | Subject to market risk |
| Regular Income | Fixed | Customizable |
| Inflation Adjustment | Not available | Possible |
| Liquidity | Locked in for 5 years | Fully liquid |
| Capital Growth | No growth | Equity offers appreciation |
While POMIS benefits conservative investors with guaranteed returns, SWPs allow monthly withdrawals with market-linked growth.
For those comparing SWP vs POMIS, it’s important to factor in inflation and liquidity—two areas where SWPs excel.
POMIS works well for those who value safety above all else—it delivers fixed income and peace of mind. But it’s a trade-off: limited flexibility, no inflation adjustment, and capped returns.
In contrast, a Systematic Withdrawal Plan (SWP) in mutual funds offers something more dynamic. It adapts to rising costs, allows liquidity when needed, and keeps the door open for long-term growth.
For retirees looking beyond just preservation—those who wish to sustain and grow their money—SWP stands out as a more thoughtful, future-ready choice.
Unlike the POMIS lock-in period, mutual fund SWP offers full liquidity, making it easier to adjust plans when life changes.
SWP mutual fund benefits include inflation-adjusted income and corpus appreciation, giving retirees more control over their finances.
Fixed-income options like POMIS offer peace of mind—safe capital and steady income. But here’s the catch: inflation doesn’t retire. Over time, rising costs quietly reduce the value of your money, making today’s income feel inadequate tomorrow.
That’s why retirees need more than just safety—they need sustainability. A smart way forward? Blend debt for stability and equity for growth. This balance helps your money generate regular income and grow to keep up with inflation.
Whether you’re comparing SWP vs post office schemes like POMIS or considering the best income plan for retirement, flexibility is key.
When choosing an investment, ask:
Is it safe?
Is it flexible?
Will it grow with me?
Mutual fund vs post office—while both have merit, only mutual fund SWPs offer the ability to match income with rising expenses.
Relying on a single product might not meet all your needs. A well-structured Systematic Withdrawal Plan (SWP), backed by the right mix of funds, can offer monthly income, liquidity, and long-term value—something fixed schemes alone may not provide.
And if you’re unsure where to begin, don’t hesitate to talk to a Certified Financial Planner (CFP). A personalized plan can turn your savings into a lifelong income stream.
After all, retirement isn’t just about having enough—it’s about staying ahead.
Use a SWP calculator or POMIS calculator to understand what kind of monthly income and long-term returns you can realistically expect.
From post office savings scheme to mutual fund withdrawal plans, align your strategy with your lifestyle, not just your comfort zone.
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