In an effort to promote the welfare of the girl child and empower her financially, the Indian Government introduced the Sukanya Samriddhi Yojana (SSY) as a part of the Beti Bachao, Beti Padhao campaign. This scheme aims to encourage parents to save and invest in their daughters’ future education and marriage expenses. Sukanya Samriddhi Yojana is a small savings scheme that offers attractive interest rates and tax benefits to encourage long-term savings for the girl child.
Under the Sukanya Samriddhi Yojana, parents or guardians can open an account in the name of a girl child who is below 10 years of age. A maximum of two accounts can be opened for two different girl children in a family. The account can be opened at any post office or authorized branch of commercial banks in India.
To make the scheme more accessible and convenient, the government has also introduced online facilities for account opening and transactions. One can easily open and manage the Sukanya Samriddhi Yojana account through the online portal provided by the respective bank or post office.
Features and Benefits of Sukanya Samriddhi Yojana:
● High-Interest Rate:
The Sukanya Samriddhi Yojana offers a higher interest rate than other small savings schemes. The government revises the interest rate every quarter, which is compounded annually. As of the knowledge cutoff in September 2021, the interest rate is set at 7.6% per annum.
● Long-Term Investment:
The scheme has a long tenure of 21 years or until the girl child gets married, whichever is earlier. This long-term investment horizon allows for potential growth and accumulation of funds over time.
● Tax Benefits:
Under Section 80C of the Income Tax Act, contributions towards the Sukanya Samriddhi Yojana account are eligible for tax deductions. Additionally, the interest earned and the maturity amount are also tax-free.
● Flexibility in Deposits:
The scheme allows flexibility in the deposit amount. The minimum deposit required is Rs. 250, and the maximum deposit allowed is Rs. 1.5 lakh per financial year. Parents can make contributions at their convenience, but it is advisable to make regular contributions to maximize the scheme’s benefits.
● Partial Withdrawal:
Partial withdrawals of up to 50% of the balance at the end of the preceding financial year are allowed for higher education purposes of the account holder after she turns 18 years old. However, it is important to note that such withdrawals are permissible only if the account holder provides proof of admission to a recognized educational institution.
Calculating Sukanya Samriddhi Yojana Returns
To better understand the potential returns and growth of your investments in the Sukanya Samriddhi Yojana, you can use the Sukanya Samriddhi Yojana calculator available online. This calculator considers factors such as the initial deposit amount, annual contributions, and the prevailing interest rate to estimate the maturity amount.
Similarly, if you are considering investing in other financial instruments, such as National Pension Scheme (NPS) offered by the government, you can use the NPS calculator to calculate the potential returns on your investments based on factors like the investment amount, tenure, and expected rate of return.
Both calculators are helpful tools to evaluate and compare the potential returns of different investment options, allowing you to make informed decisions based on your financial goals and risk appetite.
Conclusion
The Sukanya Samriddhi Yojana is a commendable initiative by the Indian government to promote the financial security and education of the girl child. By opening an account under this scheme, parents or guardians can ensure a bright future for their daughters by saving and investing in a disciplined manner. The attractive interest rates, tax benefits, and long-term nature of the scheme make it an appealing investment option for individuals seeking to secure their child’s financial future. Utilizing the available online calculators to estimate the returns and plan your investments accordingly is advisable.