Saving for the future is essential, especially when it comes to securing the future of our loved ones. For the bright future of the girl child in India, the government has introduced a special savings scheme called Sukanya Samriddhi Yojana (SSY).
This scheme, launched under the "Beti Bachao, Beti Padhao" initiative, aims to provide financial security and support to the girl child.
In this blog, we will look into what Sukanya Samriddhi Yojana is all about, how it works, and how you can benefit from it.
What is the Sukanya Samriddhi Yojana (SSY)?
Sukanya Samriddhi Yojana, abbreviated as SSY, is a government-backed savings scheme designed specifically to secure the future of girl children in India. It encourages parents to save and invest in the education and marriage expenses of their daughters. The scheme offers attractive interest rates and tax benefits, making it a popular choice among parents and guardians.
How does Sukanya Samriddhi Yojana work?
Sukanya Samriddhi Yojana works on the principle of long-term savings and investment. Here's how it works:
Who can open a Sukanya Samriddhi account?
Parents or legal guardians of a girl child below the age of 10 years can open an SSY account on her behalf. Only one account is allowed per girl child, and a maximum of two accounts per family is permitted.
Minimum deposit:
To open a Sukanya Samriddhi Yojana account, a minimum deposit of Rs. 250 per fiscal year is required. The maximum investment limit is Rs. 1.5 lakh per annum.
Tax benefits:
Investments made under Sukanya Samriddhi Yojana qualify for tax deductions under Section 80C of the Income Tax Act, up to Rs. 1,50,000 per annum. Additionally, the interest accrued and the maturity amount are tax-free.
Interest rates:
The interest rates on SSY are set by the government and are reviewed quarterly. The interest rate is 7.6% per annum.
Maturity period:
The SSY account matures after 21 years from the date of opening or upon the marriage of the girl child after she turns 18, whichever is earlier.
Must Read: 6 Benefits Of Sukanya Samriddhi Yojana
Benefits of opening an SSY account with Kotak811
Convenience:
Enjoy the ease of opening an SSY account from anywhere, be it your home or office, without the need to visit a branch.
User-friendly digital application:
Kotak's online application process is designed to be hassle-free, allowing you to fill out forms, submit documents, and make deposits with ease.
Expert guidance:
Receive assistance throughout the SSY account opening process. Whether you have questions about eligibility criteria, required documentation, or investment options, Kotak's customer support is readily available to help.
Seamless integration:
Once your SSY account is established through Kotak811, you can seamlessly manage it alongside your regular banking activities. Monitor your investments, track interest accrual, and make deposits conveniently through Kotak's digital platform.
Security assurance:
Rest assured that your investments and personal information are safeguarded by Kotak Mahindra Bank's robust online banking protocols, providing you with peace of mind regarding your daughter's financial future.
Must Read: What Is Video KYC? Everything You Need To Know
Comparing Sukanya Samriddhi Yojana with traditional savings schemes
Sukanya Samriddhi Yojana (SSY) is a specialised savings scheme designed to cater to the future financial needs of the girl child in India. Let's compare SSY with traditional savings schemes to understand its unique features and benefits.
SSY vs. Regular Savings
- SSY: Specifically tailored for the long-term financial security of girl children, with tax benefits and higher interest rates.
- Regular Savings: Offers general-purpose savings without any specific focus on children's future needs with lower interest rates and fewer tax benefits.
Eligibility
- SSY: Open to parents or legal guardians of girl children below 10 years of age, with only one account allowed per child.
- Regular Savings: Available to individuals of all ages, without any restrictions based on gender or age.
Tax benefits
- SSY: Qualifies for tax deductions under Section 80C of the Income Tax Act, with tax-free interest and maturity amount.
- Regular Savings: Offers limited tax benefits, such as tax deductions on interest earned up to a certain limit, but does not provide specific exemptions like SSY.
Interest rates
- SSY: Offers attractive interest rates set by the government, typically higher than those of regular savings accounts.
- Regular savings: Provides variable interest rates.
Purpose and usage
- SSY: Designed primarily for accumulating funds for the education and marriage expenses of girl children, with a long-term investment horizon.
- Regular savings: Used for various purposes, including emergency funds, short-term goals, and day-to-day expenses, with more flexibility in withdrawals.
Government backing
- SSY: Backed by the Government of India, providing assurance and reliability to investors.
- Regular savings: Offered by banks and financial institutions, subject to market risks and fluctuations.
Conclusion
Sukanya Samriddhi Yojana is a commendable initiative by the Indian government to promote the welfare and empowerment of girl children. By investing in SSY, parents can ensure a secure future for their daughters, covering their education and marriage expenses. With attractive interest rates, tax benefits, and flexible investment options, SSY is indeed beneficial for every parent striving to provide the best for their child.
By incorporating the SSY scheme into your financial planning, you can pave the way for a brighter tomorrow for your daughter, ensuring that she receives the support and resources to fulfil her dreams and aspirations. So, don't wait any longer, open an SSY account today and take the first step towards securing your daughter's future!
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This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empanelled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees, and contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.
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