Senior Citizen Saving Scheme, Small Savings Scheme, What is the Senior Citizen Saving Scheme?, How can I open a Senior Citizen Saving Scheme account?, What is the Rate of Interest for Senior Citizen Saving Scheme?, What is the Tenure of Senior Citizen Saving Scheme, What is the Minimum Amount to Invest in Senior Citizen Saving Scheme, What is the Maximum Amount of to Invest in The Senior Citizen Saving Scheme?, Pradhan Mantri Vaya Vandana Yojana (PMVVY), What is Pradhan Mantri Vaya Vandana Yojana (PMVVY), National Pension System, What is the difference between Senior Citizen Saving Scheme (SCSS) and Pradhan Mantri Vaya Vandana Yojana (PMVVY)?
A government-sponsored program called the Senior Citizen Saving Scheme (SCSS) pays more interest than fixed deposit options.
The program, which is a part of the Small Savings Scheme, provides senior individuals with a guaranteed income alternative and a tax-free investment limit of up to Rs 30 lakh.
Every three months, the government adjusts the interest on the SCSS; the announcement of the interest for the fiscal year 2023–2024’s October–December quarter is anticipated on September 30.
According to experts, there is little chance of a further increase in SCSS interest rates for the quarter between October and December.
What is the Senior Citizen Saving Scheme?
The Indian government offers a retirement benefit program called the Senior Citizen Saving Scheme (SCSS). It is intended to give seniors over 60 years of age financial security.
The Senior Citizen Savings Scheme has a 5-year term with the option of an additional 3-year extension and an interest rate of 7.40% annually (Q2 FY 2022-23).
The minimum and maximum investment amounts are ₹1,000 and ₹15,000, respectively, or the retirement benefit, whichever is less.
Anyone can open an account at any recognized bank or post office in India. The installment amount is limited to the retirement benefits and ranges from 1,000 to 15 lakhs.
Within one month of collecting retirement payments from his or her work, the recipient must deposit money in the Senior Citizen Scheme account. Additionally, if a person deposits more money than the allowed amount, the extra money is returned to the account holder.
The principal invested in this scheme is eligible for a deduction under Section 80C of the Income Tax Act, subject to a cap of Rs. 1.5 lakhs per year.
Additionally, interest from the Senior Citizen Savings Scheme is taxed based on a person’s tax bracket. However, TDS (Tax Deducted at Source) is applicable if the sum surpasses 50,000 for a fiscal year.
The returns on this scheme are issued as it is a government-backed instrument. Moreover, contrary to market-linked investments, which are subject to fluctuations, Senior Citizen Saving Scheme is safe and offers assured returns to individuals.
How can I open a Senior Citizen Saving Scheme account?
You can submit the application form and the Know Your Customer (KYC) papers at the closest post office or bank branch to open a Senior Citizen Savings Scheme account. Additionally, a check for the amount being deposited must be provided.
A minimum deposit of ₹1,000 and a maximum deposit of ₹15,000, or the retirement benefit received, whichever is less, can be made to start the account. After the initial five-year maturity period, the depositor may extend the account for an additional three years.
What are the other investment options for senior citizens?
There are several investment options available for senior citizens in India. Some of the popular ones are:
Pradhan Mantri Vaya Vandana Yojana (PMVVY):
For senior persons 60 years of age and over, the Indian government offers this pension program. The 10-year term of the scheme comes with an interest rate of 7.40% annually. The minimum and maximum investment amounts are respectively ₹1,56,658 and ₹15,00,000.
Fixed Deposits (FDs):
FDs are a well-liked investment choice for seniors since they provide assured returns with no risk. FDs are available from banks and post offices with a range of interest rates and terms.
Mutual Funds:
A type of investment known as a mutual fund collects money from numerous individuals to invest in stocks, bonds, or other securities. Seniors who want a monthly income with low risk can choose debt mutual funds.
National Pension System (NPS):
For anyone between the ages of 18 and 65, the Indian government offers the NPS voluntary pension program. Seniors who want a steady income after retirement can invest in NPS.
What is the difference between Senior Citizen Saving Scheme (SCSS) and Pradhan Mantri Vaya Vandana Yojana (PMVVY)?
The Senior Citizen Savings Scheme (SCSS) and Pradhan Mantri Vaya Vandana Yojana (PMVVY) are both popular investment options for senior citizens in India. Here are some differences between the two schemes:
SCSS Vs PMVVY | Lock-in duration | PMVVY |
Rate of Interest | 7.40% (Annual) | 7.40% (Annual) |
Tenure | 5 Years With 3 Years Extension Option | 10 Years |
Min-Max Investment | ₹1,000–₹15,000 | ₹15,000–₹1,56,658 |
Taxation | Under 80C deductible up to a maximum of 1.5 lakh & TDS if the interest exceeds ₹50000 in that fiscal year. | Under 80C deductible up to a maximum of 1.5 lakh, NO TDS |
Lock-in duration | 5 YEARS | 10 YEARS |
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1. Interest rate: Starting in the second quarter of fiscal year 2022–2023, SCSS and PMVVY both provide an interest rate of 7.40% annually.
2. Tenure: The The Senior Citizen Savings Scheme (SCSS) has a five-year term with a three-year extension option.
Pradhan Mantri Vaya Vandana Yojana (PMVVY), on the other hand, has a ten-year tenure.
3. Minimum and maximum investment amounts: The Senior Citizen Savings Scheme (SCSS) has a ₹1,000 minimum investment requirement and a ₹15,000 maximum investment requirement, whichever is smaller.
The Pradhan Mantri Vaya Vandana Yojana (PMVVY) investment maximum is ₹1,56,658 and the PMVVY investment minimum is ₹15,000 per transaction.
4. Taxation: Under Section 80C of the Income Tax Act, the principal invested in both plans is deductible up to a maximum of 1.5 lakh rupees per year.
However, interest on The Senior Citizen Savings Scheme (SCSS) is taxed based on a person’s tax bracket. TDS (Tax Deducted at Source) is applicable if the interest earned for a fiscal year exceeds ₹50,000.
The Pradhan Mantri Vaya Vandana Yojana (PMVVY), on the other hand, provides tax-free returns.
5. Lock-in duration: The Pradhan Mantri Vaya Vandana Yojana (PMVVY) has a lock-in duration of 10 years, compared to The Senior Citizen Savings Scheme (SCSS)’s 5 years.
Please note that this information was current as of Q2 FY 2022-23 and may be subject to change.
DISCLAIMER: Mahayojna.org does not guarantee for this data to be 100% accurate, please see the government official portal for the accurate calculations and data.
If you have any correction in this data, please feel free to contact us info@mahayojana.org
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