The biggest concern after retirement is the end of a fixed monthly salary. In such a case, what if you find an investment option that gives you a fixed monthly income even after retirement? The Post Office’s Senior Citizen Savings Scheme (SCSS) is one such good option. This government-backed scheme offers safe investment and gives you a guaranteed monthly interest of ₹20,500. Let’s understand how this works.
Post Office’s Special Scheme for Senior Citizens
The Senior Citizen Savings Scheme (SCSS) is a special plan for people above 60 years of age. It is backed by the Government of India and gives more interest than most bank fixed deposits (FDs). Your money is also 100% safe in this scheme. You need to deposit a lump sum amount for 5 years, and you will get guaranteed interest every 3 months.
At present, SCSS gives an interest rate of 8.2% per year. Once you invest, this rate is fixed for the full 5 years, even if interest rates go down later.
How Much Can You Earn?
You can invest from ₹1,000 up to ₹30 lakh in this scheme. If you invest the full ₹30,00,000, you will earn ₹2,46,000 per year, which means ₹20,500 every month. In 5 years, you will get a total interest of ₹12,30,000. So after 5 years, you will receive ₹42,30,000 — your investment plus total interest.
Who can invest?
Any person aged 60 years or above can invest. People taking retirement under VRS or from defence can also invest with some age relaxations.
Tax benefit:
You get tax exemption up to ₹1.5 lakh under Section 80C. But the interest is taxable. If you earn more than ₹1 lakh interest in a year, TDS is deducted. You can also extend the account for more time after 5 years if needed.