The Sukanya Samriddhi Yojana (SSY) is a ground-breaking, government-sponsored scheme launched by the Indian Government, under the “Beti Bachao, Beti Padhao” campaign. It aims to safeguard the future of girls by encouraging their education and relieving the financial burden associated with their marriage. ‘Sukanya Samriddhi’ translates to ‘prosperity for girls,’ which precisely indicates the primary ethos of the scheme.
Primarily, the SSY scheme is designed to ensure that families of girl children put aside funds for their future. The scheme allows parents to open an account in the name of their daughters below ten years of age. A maximum of two accounts is permissible per family, with a combined maximum deposit limit of ₹1.5 lakhs per year until the girl reaches the age of 21 years.
The SSY scheme is hailed for its excellent return rates. The current interest rate, set at 7.6% per annum (2021-2022), surpasses the interest rates offered by many other saving schemes. Moreover, the interest is calculated and compounded annually, with a guarantee of a fixed return, which makes it an appealing savings option.
One of the significant benefits of Sukanya Samriddhi Yojana is the tax benefits it offers under section 80C of the Income Tax Act. This scheme is EEE (Exempt-Exempt-Exempt) category, meaning the deposited amount, the maturity amount, and the interest earned are all exempted from tax. This tax exemption will make a significant impact on the savings of middle-class families.
In terms of flexibility, the SSY scheme offers an attractive proposition. The minimum annual deposit is just ₹250, and parents can increase the amount as per their financial capability. Regular deposits can be made for 15 years from the date of opening an account, while the account remains active for 21 years.
Another key aspect of Sukanya Samriddhi Yojana is its focus on financing higher education and marriage expenses. The scheme allows partial withdrawal (up to 50%) for the girl’s education after she turns 18. The amount standing at the credit of the account can be wholly withdrawn when she reaches 21 years or for the purpose of her marriage if she is above 18 years.
Moreover, if the account holder (the girl) becomes a non-resident Indian (NRI) after opening the account, the account shall not earn interest under this scheme from the date of her becoming a non-resident.
However, potential investors must examine all the pros and cons before using the Sukanya Samriddhi Yojana calculator. Although the benefits are numerous, the scheme comes with its share of limitations.The lock-in period is pretty lengthy, and the scheme lacks liquidity, which means the money can’t be easily converted back to cash if required.
Finally, it is suggested that families seek the advice of a financial advisor and thoroughly understand the terms and conditions, benefits, and fine print associated with Sukanya Samriddhi Yojana before making any investment decisions.
**Disclaimer**: Investment in the Indian financial market, including the Sukanya Samriddhi Yojana, should be done after carefully considering various factors. The investor must gauge the potential risk factors, consult with financial advisors and make informed decisions.
Summary
The Sukanya Samriddhi Yojana (SSY) is a government initiative aimed at uplifting girls’ future in India. It allows parents to deposit up to ₹1.5 lakh annually in their daughters’ name, offering an attractive interest rate of 7.6% (2021-2022). It provides tax benefits under section 80C and ensures flexibility with a minimum annual deposit of just ₹250. The scheme also permits partial withdrawals for higher education or marriage expenses after the girl turns 18. Though it harbors several benefits, it also poses restrictions given the long lock-in period, and the money can’t be quickly converted to cash if needed. Hence, while Sukanya Samriddhi Yojana proves to be a promising investment tool, it should be chosen after a thorough understanding and consultation with a financial advisor.
