Looking for Rs 20,000 monthly income? Here's how Senior Citizen Savings Scheme can help
By Team Asianet Newsable | First Published Sep 16, 2024, 4:25 PM ISTIndividuals who are 60 years and above can open an account under the SCSS. However, individuals opting for voluntary retirement (VRS) between the ages of 55 and 60 are also eligible to invest. Additionally, defense personnel can invest in the scheme starting at 50 years of age.
As people age, the need for a reliable source of income becomes crucial to ensure financial stability during retirement. The Government of India's Senior Citizen Savings Scheme (SCSS) is designed to provide a safe and fixed monthly income for senior citizens, offering a secure investment option post-retirement.
Eligibility for SCSS:
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Individuals who are 60 years and above can open an account under the SCSS. However, individuals opting for voluntary retirement (VRS) between the ages of 55 and 60 are also eligible to invest. Additionally, defense personnel can invest in the scheme starting at 50 years of age.
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Investment limits:
Investors can deposit a minimum of ₹1,000 and a maximum of ₹15 lakh under the SCSS. The scheme allows for both individual and joint accounts with a spouse. While multiple accounts can be opened, the total investment across all accounts cannot exceed ₹15 lakh.
Maturity period:
The SCSS has a maturity period of 5 years. Upon reaching maturity, investors have the option to extend the account for an additional 3 years by applying before the maturity date.
Interest rate:
For the year 2024, the SCSS offers an annual interest rate of 8.2%. Interest is credited quarterly on the first working day of April, July, October, and January.
How to earn Rs 20,000 per month?:
To receive a monthly income of Rs 20,000 post-retirement, an individual would need to invest Rs 30 lakh in the SCSS. With an interest rate of 8.2%, this investment would yield Rs 61,500 every quarter, which translates to Rs 20,000 monthly.
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Tax benefits:
While TDS is applicable if the annual interest exceeds Rs 50,000, SCSS offers income tax benefits under Section 80C of the Income Tax Act. Investors can claim tax exemptions on amounts up to Rs 1.5 lakh annually.
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