Many people explore various avenues to meet their financial needs after retirement. Government employees receive a pension. But what about those working in the private sector? A good scheme is available for such people.
Regular income is essential in retirement. Expenses don't decrease, but income stops. If you want a safe, government-guaranteed scheme, the Senior Citizen Savings Scheme (SCSS) is a great option. Available through the post office, this scheme offers financial security after retirement.
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Who is eligible for this scheme?
Those who have completed 60 years of age can join this scheme.
Government employees who have taken VRS between 55 and 60 years of age can also invest.
Those retiring from Defense Services (Army, Navy, Air Force) are eligible to invest from 50 years of age.
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Benefits of investing in SCSS
This scheme currently offers 8.2% annual interest, higher than bank FDs. The investment amount is fully secure with a government guarantee. Tax deduction up to ₹1.5 lakh is available under Section 80C of the Income Tax Act. Note that interest income is taxable.
You can invest a maximum of Rs 30 lakhs in this scheme. At 8.2% interest, you'll earn approximately Rs 2.46 lakhs in interest annually, which translates to about Rs 20,500 monthly income. A Rs 15 lakh deposit earns Rs 10,250 monthly. This steady income is helpful for medical expenses and other needs after retirement.
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Important points
Minimum investment is Rs 1,000, in multiples of Rs 1,000. The scheme duration is 5 years, extendable by 3 years. Premature closure is available. Joint accounts with a spouse are allowed, but deposits must be in the primary holder's name.
