The senior citizen savings scheme (SCSS) is a popular small saving scheme, offering retirees a risk free and tax saving investment. It is one of the best investment options for retirees, who need income in retirement. The interest paid on deposits is pre- specified and not affected by market fluctuations. The scheme is backed by the government and enjoys sovereign guarantee.
Investing in SCSS is a great way of reducing the gap between pension and salary. The SCSS scheme can be availed for a minimum of 5 years, with a further extension of 3 years. The money invested must be in multiples of Rs 1,000 and the SCSS scheme can be availed easily at post offices or public sector banks and requires minimal documentation. Currently, the rate of interest offered for senior citizen savings scheme is 8.7% a year, which makes it an ideal investment option for retirees.
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SEE ALSO: What’s Senior Citizen Savings Scheme?
Currently, the interest rate offered on senior citizens saving scheme is 8.7% a year. As retirees want steady income, saving in SCSS makes sense. SCSS helps you receive regular income and covers monthly expenses.
Senior citizen savings scheme is one of the best investment options for conservative investors. It is an effective and long term saving option, which offers capital protection along with quarterly interest payments as a source of income. There are other advantages of this scheme.
There are some important eligibility criteria that the applicant must fulfill for availing Senior citizen savings schemes in India. You must keep the following points in mind before applying for this scheme:
Senior citizen savings schemes are specifically designed to meet the requirements of senior citizens. There are certain rules that the applicant must abide while enrolling in senior citizen savings scheme:
After 1 year: 1.5% of the invested amount.
After 2 years: 1% of the invested amount.
The senior citizen savings scheme is offered by Indian post offices along with 24 public sector banks and 1 private sector bank. Listed below are the names of the private and public sector banks that offers senior citizen saving scheme:
SCSS is a promising investment scheme for the senior citizens or retirees introduced by the government. It is a secure and risk free investment. It is better to invest in a senior citizen saving scheme than FDs as the returns are much higher than fixed deposits. Investing in SCSS is a good option as interest is paid in quarterly cycles. The depositor can have a monthly income and the sum of money invested will be returned at the end of the tenure. An FD accumulates interest which can be encashed only after maturity.
While opening an SCSS account, the documents submitted must be legitimate. In case the information is found to be false or incorrect, then the account will be closed immediately. The interest earned will be deducted and only the principal amount will be returned.
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