Post Office MIS Scheme 2026: Invest ₹5 Lakh and Get ₹3,083 Monthly Income, Check 5-Year Returns
Post Office Monthly Income Scheme 2026: Are you looking for a government-backed savings option that can provide regular monthly income without exposing your money to stock market fluctuations? The Post Office Monthly Income Scheme (POMIS) could be worth considering. Under this small savings scheme, investors deposit a lump sum and receive interest payments every month for five years.
For the October–December 2026 quarter, the reported annual interest rate under the Post Office MIS is 7.4%. At this rate, an investment of ₹5 lakh can generate approximately ₹3,083 every month, while the total interest earned over five years comes to ₹1.85 lakh.
The scheme may appeal to retirees, senior citizens, homemakers, and individuals who want predictable cash flow from their accumulated savings.
However, before opening an account, it is important to understand the investment limits, interest calculations, maturity rules, taxation, and conditions for premature withdrawal.
What Is the Post Office Monthly Income Scheme?The Post Office Monthly Income Scheme is a government-supported small savings product offered through India Post.
Unlike recurring deposits, where customers invest money at regular intervals, MIS requires a one-time deposit when the account is opened.
Interest is calculated on the deposited amount at the applicable annual rate and is payable monthly.
The investment remains in the account for a five-year term, after which the principal amount becomes payable according to the scheme rules.
An important feature is that investors do not need to withdraw part of their original deposit to receive monthly income. The regular payout comes from interest earned on the investment.
Post Office MIS Interest Rate for October–December 2026According to the reported rate for the October–December 2026 quarter, Post Office MIS offers an annual interest rate of 7.4%.
The government reviews interest rates on small savings schemes periodically, generally on a quarterly basis.
For an MIS account, the rate applicable when the deposit is made ordinarily remains fixed for the account's five-year tenure.
This provides predictability because investors can estimate their monthly interest income when opening the account.
However, prospective depositors should confirm the applicable rate through India Post or an official government notification before investing.
₹5 Lakh Investment in Post Office MIS: How Much Will You Earn?Suppose an investor deposits ₹5,00,000 in the Post Office Monthly Income Scheme at an annual interest rate of 7.4%.
The annual interest calculation would be:
₹5,00,000 × 7.4% = ₹37,000
Since interest is payable every month, the monthly income would be:
₹37,000 ÷ 12 = ₹3,083.33
Over five years, the total interest would be:
₹37,000 × 5 = ₹1,85,000
Here is the complete calculation.
Investment Details Amount| Initial Deposit | ₹5,00,000 |
| Annual Interest Rate | 7.40% |
| Interest Earned in One Year | ₹37,000 |
| Monthly Interest Income | ₹3,083.33 |
| Total Interest Over 5 Years | ₹1,85,000 |
| Principal Returned at Maturity | ₹5,00,000 |
| Principal + Total Interest | ₹6,85,000 |
The combined amount of ₹6.85 lakh represents the original investment plus all interest paid over five years.
It does not mean that ₹6.85 lakh will be paid as a single lump sum at maturity. The interest is distributed monthly, while the principal is returned when the account matures.
Under the scheme's reported investment limits, an individual can deposit up to ₹9 lakh in a single account.
At an annual interest rate of 7.4%, the calculation is straightforward.
Annual interest:
₹9,00,000 × 7.4% = ₹66,600
Monthly interest:
₹66,600 ÷ 12 = ₹5,550
Total interest over five years:
₹66,600 × 5 = ₹3,33,000
Therefore, an investment of ₹9 lakh could provide ₹5,550 every month and total interest of ₹3.33 lakh over the five-year period.
At maturity, the original ₹9 lakh deposit would be returned, subject to the scheme's terms.
Joint Account Investment: Earn ₹9,250 Every MonthThe Post Office MIS also allows joint accounts, making it possible for eligible family members to invest together.
The maximum permitted deposit in a joint account is ₹15 lakh under the reported rules.
If the full ₹15 lakh is invested at 7.4% annual interest, the monthly payout would be ₹9,250.
The total interest earned over five years would reach ₹5.55 lakh.
Single Account vs Joint Account: Complete Return Comparison Particulars Single Account Joint Account| Maximum Deposit | ₹9,00,000 | ₹15,00,000 |
| Annual Interest Rate | 7.40% | 7.40% |
| Annual Interest | ₹66,600 | ₹1,11,000 |
| Monthly Income | ₹5,550 | ₹9,250 |
| Total Interest in 5 Years | ₹3,33,000 | ₹5,55,000 |
| Principal at Maturity | ₹9,00,000 | ₹15,00,000 |
| Principal + Total Interest | ₹12,33,000 | ₹20,55,000 |
These calculations assume that the stated interest rate applies throughout the five-year term and that all monthly interest payments are received as scheduled.
Joint-account limits and each holder's share of deposits must be considered when assessing individual investment eligibility.
Monthly Income From Different Investment AmountsInvestors do not necessarily need to deposit the maximum permitted amount.
The following table illustrates the approximate monthly interest available at 7.4% annually.
One-Time Investment Monthly Interest Total Interest in 5 Years| ₹1,00,000 | ₹616.67 | ₹37,000 |
| ₹2,00,000 | ₹1,233.33 | ₹74,000 |
| ₹3,00,000 | ₹1,850 | ₹1,11,000 |
| ₹5,00,000 | ₹3,083.33 | ₹1,85,000 |
| ₹7,00,000 | ₹4,316.67 | ₹2,59,000 |
| ₹9,00,000 | ₹5,550 | ₹3,33,000 |
| ₹15,00,000 | ₹9,250 | ₹5,55,000 |
The ₹15 lakh illustration applies to an eligible joint account. Monthly amounts are approximate and before tax.
The Post Office MIS has a fixed maturity period of five years from the date of account opening.
During this period, the investor receives monthly interest payments.
Once the five-year term ends, the deposited principal becomes payable under the applicable rules.
For example, someone who invests ₹5 lakh and receives approximately ₹3,083 per month will have earned ₹1.85 lakh in interest over the full term.
The original ₹5 lakh will then be returned at maturity.
If the investor wants to continue receiving monthly income, a fresh investment may be considered, subject to the scheme rules and interest rate available at that time.
The rate on a new account may differ from the rate applicable to the previous deposit.
Can You Withdraw Money Before Five Years?Although the scheme has a five-year tenure, premature closure is permitted under specified conditions.
Generally, an MIS account cannot be closed before one year from the date of opening.
If the account is closed after one year but before three years, a deduction of 2% of the principal applies.
If the account is closed after three years but before five years, a deduction of 1% of the principal applies.
For example, on a ₹5 lakh deposit:
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A 2% deduction would amount to ₹10,000.
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A 1% deduction would amount to ₹5,000.
These deductions can reduce the amount returned to the investor.
Therefore, individuals should consider their emergency fund requirements and expected future expenses before committing money to the scheme.
Is Post Office MIS Interest Tax-Free?One important point is that interest earned from the Post Office Monthly Income Scheme is not tax-free.
The interest is generally taxable according to the investor's applicable income tax provisions and slab rate.
For instance, an individual earning ₹37,000 annually from a ₹5 lakh MIS deposit may need to include this interest in taxable income, depending on the applicable tax rules.
The scheme also does not provide an automatic deduction under Section 80C merely because money has been deposited in an MIS account.
Investors should distinguish between the gross interest shown in the calculations and the amount effectively retained after any tax liability.
Tax treatment may vary depending on individual circumstances and applicable legislation.
Who Can Consider Investing in Post Office MIS?The scheme may be suitable for individuals whose financial priorities include predictable income and preservation of capital.
Retired employees who want supplementary monthly cash flow may find the payout structure useful.
Similarly, households with surplus savings may consider MIS as one component of a diversified savings strategy.
However, the scheme may not be ideal for everyone.
Investors seeking long-term capital growth, inflation-beating returns, or immediate access to their entire deposit may need to compare other financial products.
The monthly interest amount remains fixed during the account term, which means its purchasing power could decline if inflation rises significantly.
Eligible investors can generally open an account through a post office offering small savings services.
The process typically involves completing the prescribed application form, fulfilling KYC requirements, providing the necessary documents, and depositing the investment amount through an accepted payment method.
Applicants may need identity proof, address proof, PAN or other prescribed tax identification details, and photographs, depending on the applicable requirements.
For a joint account, the required information and documentation of all account holders must be submitted.
Investors should also provide accurate bank account and nomination details wherever required.
The Post Office Monthly Income Scheme offers a structured way to generate regular income from a one-time investment.
At the reported annual interest rate of 7.4%, depositing ₹5 lakh can provide approximately ₹3,083 per month and ₹1.85 lakh in total interest over five years.
Investors using the maximum single-account limit of ₹9 lakh could receive ₹5,550 monthly, while an eligible joint-account investment of ₹15 lakh could generate ₹9,250 every month.
Before investing, check the current official interest rate, deposit limits, taxation rules, and premature closure conditions. The scheme can support predictable monthly cash flow, but the investment amount should match your financial needs and ability to keep the principal committed for five years.
Disclaimer: This article is intended for general financial information only. Return calculations are illustrative and based on an assumed annual interest rate of 7.4%. Actual eligibility, interest rates, and scheme conditions are governed by official rules. Consult a qualified financial or tax adviser before making investment decisions.
Editorial note: The article is independently rephrased from the supplied material. The 7.4% rate for October–December 2026 is taken from that material and has not been independently verified against the latest official notification.