SCSS: The elderly population in India is growing rapidly, and the need for a regular income after retirement becomes a major concern. In such a scenario, senior citizens need schemes where their money is safe, and they receive a fixed return every year. The Senior Citizen Saving Scheme (SCSS) is designed keeping this need in mind, ensuring financial stability after retirement.
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What is the Senior Citizen Saving Scheme?
The Senior Citizen Saving Scheme is a government-backed small savings scheme specifically launched for citizens aged 60 years and above. In some special cases, government employees who have retired at the age of 55 are also allowed to invest in it. This scheme is operated through post offices and authorized banks, further enhancing its reliability.
Current Interest Rate and Maturity Period
Currently, the Senior Citizen Saving Scheme offers an attractive interest rate of 8.2 percent on investments. The interest is paid quarterly, providing senior citizens with a regular source of income. The scheme has an initial maturity period of five years, which can be extended once for another three years.
Additional Benefit of Tax Exemption
A major advantage of this scheme is that the investment made is eligible for tax exemption under Section 80C of the Income Tax Act. This allows senior citizens not only to make a secure investment but also to reduce their tax liability. However, the interest earned is taxable and is subject to tax as per the rules.
Things to Consider Before Investing
Before investing in the Senior Citizen Saving Scheme, it is essential to thoroughly understand the scheme’s terms and conditions, interest rates, and tax rules. It is also important to remember that the invested amount will be locked in for a long period, so it is best to make a decision keeping your future needs in mind.