Sukanya Samriddhi Yojana (SSY)

Know SSY

Objective

To encourage parents to save for the education and marriage of the girl child in a regular manner, which provides a guaranteed tax-free return.

Specific Feature

Only girl child can be enrolled for this program

Who can join?

Any girl child, who is below 10 years of age.

Who is the account holder?

Girl child is the account holder

Who contributes to the scheme?

Parents or legal guardian of the child

Who operates the account?

Parent or legal guardian till the child reaches 18 years of age and afterwards the account holder operates the account. 

How many accounts one child can hold?

Only one account per child is permitted.

Maximum account in a family

Two accounts per family is permitted and more than two accounts can be held provided that more than two accounts may be opened in a family if such children are born in the first or in the second order of birth or in both, on submission of an affidavit by the guardian supported with birth certificates of the twins/triplets regarding the birth of such multiple girl children in the first two orders of birth in a family

Mode of deposit

Deposit can be made on monthly or yearly mode and can be paid in Cash/Online. /Cheque etc.

Minimum Contribution

Rupees 250 per year. If minimum contribution is not paid, the account will be categorized as default account. Default account can be revived before completing 15 years by paying a fine of 50 rupees per each default year.

Maximum Contribution

Rupees 1.5 L per year

Interest Rate

As decided and announces by the Central Govt every quarter.

Period of Interest Credit

Interest will be credited at the end of financial year. Interest calculated on the amount deposited and the interest accumulated. (Compounding)

Tax Benefit

The amount invested is eligible for tax benefit under Sec 80 C. 

Maturity

The scheme will mature when the account holding period completes 21 years from the date of joining.

Contribution period

15 years (Not age) or till the marriage of the child, which is after 18 years of age, which is left to the choice of the parents/account holder.

Premature Closure

Premature closure is complete withdrawal of the amount before completing 21 years from the date of joining.

Premature Closure happens in 2 scenarios

·       Death of account holder. In this case the parents/legal guardian can withdraw after submitting the necessary documents

·        Account holder completes the age of 21 years and then marriage happens before completion of 21 years from the date of joining, the amount invested along with the interest accrued can be totally withdrawn.

·      If the account holder marries after attaining the age of 18 years, the account can be closed and the benefit will be paid to the account holder.

Partial Withdrawal

Partial withdrawal is permitted after the child attains 18 years of age or passed 10th standard and for specific purposes as mentioned below

Limit & Condition for Partial Withdrawal

Can be done in one lumpsum or in instalments, not exceeding one withdrawal per year for a maximum period of 5 years.

·        Withdrawal is permitted only for education purposes

·       Withdrawal is limited to the amount of school fee as indicated in the relevant fee slip issued by the educational institution.

Maximum Amount allowed for Partial Withdrawal

50% of the amount credited in the account in the previous financial year in lumpsum cases or based on the school /college fee.

What is good about the scheme?

·        A scheme for regular savings only for the girl children

·       Guaranteed and tax-free maturity

·        Tax Saving under Sec 80 C during the period of investment

What is not that good about the scheme?

·        Maximum amount allowed for investment is limited up to 1.5L

·       The interest rate is not fixed and it varies based on the overall interest rate in the market.

·    Example- The interest rate was once 9.2 %, whereas now the interest rate is 7.6%.  This change affects the maturity amount.

Who is not allowed to join Sukanya Samridhi scheme?

NRIs are not allowed to join the scheme as per the current rules.

 

Some Specific Scenario,

If a girl child joins this scheme at the age of 9 years, the following are the options

1.       Contribution can be done till completion of 15 years of period from the joining of the scheme. This means contribution can be done till 24 years of age

2.       Contribution can be done till the girl child gets married any time after attaining the age of 18 years.

3.       The account holder can retain the account till 21 years of completion from the date of joining This means, she can hold the account till 30 years of age and for this the payment need to done all 15 years.


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