To support a family of 4 members with a corpus of Rs. 60 lakhs would require detailed planning and even more precaution in spending, as the expenses for 4 people will vary around 15,000 - 20,000 monthly depending upon the cost of living where you reside. This can be less if you own a house and don't plan a capital investment in the near future.
Most common schemes available for a Senior citizen are Post Office Monthly Income Scheme (POMIS) and Senior Citizen Saving Scheme (SCSS), both offering interest rates over 7%, i.e. 7.6% for POMIS and 7.4% for SCSS. The maximum amount that can be invested in these schemes is 9 lakhs in POMIS (Joint account) and 15 lakhs in SCSS.
POMIS will offer monthly income while SCSS will offer quarterly income, which will trickle down to this:
Rs. 5,700 p.m. from POMIS (900000*7.6%/12) and Rs. 27,750 every quarter from SCSS (1500000*7.4%/4).
This can become a monthly inflow of Rs. 5700 + 9250 = Rs. 14,950.
Now you will be left with Rs. 36 lakhs as corpus (60 - 15+9). You can safely keep Rs. 6 lakhs in a savings bank with a bank offering over or around 6 % as the rate of interest, which seems a bit hypothetical in current times, but there are few banks that are actually offering that. Banks also pay quarterly interest, so this again can convert to monthly income of Rs. 3,000 safely.
Now with a balance Rs. 30 lakhs in hand you can invest around 20 lakhs in FDs for 1, 2, 3 years, and so on. This you must decide based on your immediate and future requirements. Do smaller amount FDs for short term and bigger amount FD for a longer tenure, as you already have a sum of Rs. 6 lakhs in a savings bank for any contingency. If still needed you can break smaller FDs for any emergency requirements. These FDs can also offer a return of over 7% easily but they will be only after the maturity period.
Now with the remaining Rs. 10 lakhs, you have 2 options. The first option is to open a small general store in or around your home with a small investment and or any other shop that will cater to people living around you.
You can even rent out a small shop and start earning right away. Income will be small but will keep you engaged away from boredom.
The second option is to get some rooms constructed in your house and let them out on rent and earn a rental income, again this will be totally based on the place where you reside. Advice on this aspect is purely assumption based and may not suit or work for you if you reside in a remote place.
I will suggest against investing in mutual funds or equity markets as they may seem lucrative but have huge risks attached to them and investing in these options post-retirement is a big NO.
Regarding the taxation part, there will be hardly any tax on your income as there will be deduction under Section 80TTA and basic exemption limit so your income will not be under the taxable limit. Also, you must submit Form 15H to your bank where you will invest in Fixed deposits to avoid deduction of TDS.
I am assuming that 2 people are senior citizens and the rest 2 are kids who will soon begin their professional journey and will not be burden on you in near future.
Live before you leave.