5 min read
Updated on Oct 11, 2022
A risk-free investment scheme for the elderly with assured returns to secure their future, learn all about SBI Senior Citizen Savings Scheme (SCSS) in this blog.
We work hard all our lives to earn money and meet our financial needs and those of our family. And then we also intend to create some wealth for the future to use in our post-retirement life, when we won’t be able to work or earn as much. This is when we start saving money in our present, locking it away safely in some form or the other, to use in the future.
A lot of us opt for schemes like Fixed Deposits (FDs) for this purpose since they are risk-free. However, FDs fail to generate more returns which does not eventually satisfy our purpose of saving for the future. The senior citizen saving scheme by the SBI is therefore an attempt to assure decent returns to the elderly so they can comfortably enjoy the golden age of their lives.
The saving plan introduced by the State Bank of India (SBI) is backed by the government, which gives some level of assurance to the senior citizens with regard to its safety and guaranteed returns. Under the SCSS, the elderly who are retirees can choose to open a joint account with their spouse and start investing in the account. Investments can be made via any mode – cash, cheque, demand draft, and the like.
Since the Senior Citizen Saving Scheme SBI is a government-backed plan, the rate of interest offered under the scheme is also in compliance with Govt. rules. As declared by the Govt. of India on April 1, 2020, the SBI Senior Citizen Saving Scheme interest rate was notified at 7.4%.
Unlike some other plans, the interest under SCSS is not paid cumulatively, rather paid to the investor quarterly. This also means that if the investor fails to withdraw the interest at the end of each quarter, no more returns will be payable on the scheme.
Investing in the Senior Citizen Saving Scheme of the SBI has a number of advantages for retirees. Some of these are listed below:
In order to avail the benefits described above under the SBI SCSS, there are certain requirements that must be met. Here is the eligibility criteria to apply for the scheme:
The process for applying for the SBI Senior Citizen Saving Scheme is quite simple and hassle-free. All you need to do is open an account at a SBI branch near you or a post office. You can visit any deposit office and submit the SBI Senior Citizen Saving Scheme Form A for application.
You would also be required to submit a valid proof of age along with the application form. Besides this, to open the account, you would need to deposit a certain minimum amount in multiples of thousand to get the account up and running. Note that you can opt for both single/individual and joint accounts with your spouse under the SBI SCSS plan.
Also note that the maximum limit for deposit in the account is Rs. 15 lakh and the total deposit should not ideally be higher than this limit.
At a time when you need finances the most to take care of your needs, the SBI Senior Citizen Savings Scheme is truly a boon for retirees. The scheme also provides for tax benefits along with a multitude of other benefits that can be availed by retirees. To know more about the current rate of interest payable under the plan, you can always check the SBI Senior Citizen Saving Scheme calculator online.
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