- Rs. 5 Lakh Coverage @ Rs. 12.9/Day
- 7 Lakh+ Happy Customers
- 100%Free Health Check-up
- 10,000+Hospitals for Cashless Treatment
We promise limited calls
All about Senior Citizen Saving Scheme Plans
- DetailsWritten by PolicyBazaar -
- Hits : 2127 -
Modified 05 December 2017
In our country, people are very respectful towards senior citizens or the elderly as these people have spent their whole life working in their respective domains, improving life and walking on roads in the rough and tough terrains so that the following generations are at ease. Our society remembers their valuable contributions in recognition of which, the government has come up with various schemes and facilities so that the lives of our golden generation are enriched. Generally, people prioritise buying health insurance for senior citizens. Once their health is secured, move on to securing their wealth.
There are saving plans that are formulated especially for the Indian senior citizens. Let’s find about the attractive plans catering to senior citizens.
What’s Senior Citizen Saving Scheme?
This scheme is formulated for the individuals who are above 60 years of age. The saving schemes are for Indian senior citizens. These long-term saving instruments are cost-effective. It offers top-class security with outstanding features that are associated with the savings programs backed up by the government. Such schemes can be purchased through particular banks along with the particular post offices throughout India.
A Senior Citizen Saving Scheme i.e. SCSS account can be extends up to 5 years when matured; post-maturity it can be further extended for 3 more years. The account holder can make one deposit in this account and that amount has to be a multiple of Rupees 1,000 and it can’t extend beyond Rupees 15 Lakh. SCSS accounts don’t compromise on safety, it is widely popular and it gives a savings option for the long-term. After a lifetime that is spent on supporting their families and being a part of cut-throat competition and facing a plethora of challenges thrown by life, the variety of SCSS plans offer the elderly a much-needed financial cushion for their golden years.
What are the Rates of Interest for the Senior Citizen Saving Schemes?
The rate of interest for the first quarter of the fiscal year 2017-18 i.e. April 17 – June 17 is mentioned below.
Option of Investment
Interest Rate for the First Quarter i.e. April 17 – June 17
Senior Citizen Savings Scheme
What are the Advantages of Senior Citizen Saving Schemes?
Since it is a saving as well as an investment instrument for the senior citizens, the SCSS is an ideal option. It takes pride in offering one of the highest rates of interest and being a government-backed investment instrument in our country. The SCSS is formulated to fulfill the particular insurance needs of an investment-oriented senior citizen.
Here are the benefits and features of this plan.
- Available Easily –Just fill out an application form at your nearest bank/post office and it is done.
- Reliable-It is an investment product that is backed up by the Indian Government which is loaded with the security assurance.
- Multiple Accounts-An individual can open multiple Senior Citizen Saving Scheme accounts, individually or as a joint investor. The other investor must be the spouse of the primary investor.
- Amazing Returns-At the rate of 8.6 percent per year, the returns on the Senior Citizen Saving Scheme plans are very satisfying.
- Flexible Duration-The SCSS account comes with a time-period of five years but it can be extended up to 3 more years. This way, SCSS acts as a mid-term investment tool and a long-term investment tool as well.
- Tax Saving for Senior Citizen – According to Section 80C of the Income Tax Act, 1961, senior citizens can save TDS on these schemes.
- Select Your Investment- There is only one investment permissible for every SCSS account. The amount needs to be a multiple of Rupees 1000 and it should not exceed Rupees 15 Lakh. This makes the Senior Citizen Saving Scheme investment option pretty scalable and affordable.
- Premature Termination- During the times of financial stress, you can close your Senior Citizen Saving Scheme account and access your money. This option is applicable after your account has been active for a time period of 365 days. It is a funds source which can be easily used at a moment’s notice. Although, post 1 year, 1.5 percent is charged as a penalty and the funds in your SCSS account would be deducted accordingly. The after a time duration of 2 years, 1 percent is charged as penalty.
- Minimum Paper Work - The Know Your Customer documents that act as your age proof needed to be submitted to are- birth certificate, passport, voter’s id, PAN card, senior citizen card etc.
Eligibility Criteria for Buying Senior Citizens Saving Schemes in India
To be eligible to buy a saving schemes plan for senior citizens, the applicant needs to fulfill the following criteria.
- He/she needs to be 60 years old or above.
- Under certain conditions, He/she can be 55 years old or above, but his/her age must be lesser than 60 years, given that he/she has retired from his/her employment according to VRS or superannuation and he/she must open an Senior Citizens Saving Scheme account within 1 month of enjoying the retirement benefits. Not just that; the invested amount can’t go beyond the amount of his/her retirement benefits.
- If there is a joint account, the eligibility is determined on the basis of aforementioned age criteria of the main depositor. There aren’t any age restrictions or requirements that are imposed on the secondary applicant.
The Rules of Senior Citizen Saving Scheme
A well-structured path is an important ingredient for the recipe of success and ensuring your peace of mind at the same time. When you look forward to enrolling in the SCSS, make sure that you meet the following conditions.
- You have to be 60 years of age or above. In particular situations, people falling in the category of 55 years and above can enroll.
- There is only a single deposit permitted in your Senior Citizen Saving Scheme account. The deposit amount must be in the multiples of Rupees 1,000 and the maximum investment amount is Rupees 15 Lakh.
- The interest accumulated in a Senior Citizen Saving Scheme account is paid on 31 March/30 September/31 December at the first time and after that, it is payable at 31 March, 30 June, 30 September and 31 December every year.
- The maximum time period of SCSS is five years. Although, once maturity is attained, this duration can get extended for a time period of three years.
- An account holder can enroll in various accounts at the same time. It can be individual as well as a joint account with his/her spouse. Although, the account holder must make sure that all eligibility criteria catering to the operation and validity of such accounts are fulfilled. The minimum balance must be maintained as well.
- Cash is an accepted mode of investment in case the amount is lesser than Rupees 1 Lakh. In case this amount is greater than Rupees 1 lakh, then cash isn’t accepted. The account holder must make the payment using a cheque.
- An account can be very easily and conveniently transferred from one post office or bank to the other.
- SCSS offers the facility of nomination which can be easily availed when you open an account or after your account has been active for a particular time period.
- In case the account holder wants to terminate his/her account before maturity then the applicable penalty is-
After 1 year- 1.5 percent of the invested amount
After 2 years- 1 percent of the invested amount.
Keep in mind that premature closing of the SCSS account is possible if the account has remained active for the minimum period of 1 year.
- If you wish to have a joint account, the main account holder is considered as the investor and the second account holder can only be the primary account holder’s spouse.
- In case the accumulated interest on the deposit amount is above Rupees 10,000 per year, tax is deducted at source.
- The accumulated interest is deposited in a savings account which is maintained at the post office or bank, where the SCSS is maintained.
- The investments made in the SCSS account offers tax benefits according to the provisions of Section 80C of the Income Tax Act, 1961.
The Banks that offers Senior Citizen Saving Schemes
Apart from the post offices, the Senior Citizen Saving Scheme is also offered by the selected banks in the country. From 2004, there are 24 public sector banks and 1 private sector bank that are authorized to offer Senior Citizen Saving Schemes. Here is the list of these banks.
Public Sector Banks
- Allahabad Bank
- Andhra bank
- State Bank of Bikaner and Jaipur
- State Bank of India
- State Bank of Patiala
- State Bank of Mysore
- State Bank of Travancore
- State Bank of Hyderabad
- Bank of Baroda
- Bank of Maharashtra
- Bank of India
- Canara Bank
- Corporation Bank
- Central Bank of India
- Syndicate Bank
- Dena Bank
- Union Bank of India
- UCO Bank
- Vijaya Bank
- IDBI Bank
- Indian Overseas Bank
- Indian Bank
- Punjab National Bank
- United Bank of India
Private Sector Bank
- ICICI Bank Ltd.
Senior Citizen Saving Schemes Rate of Interest
From 1-10-2016 onwards, the rate of interest for SCSS plans has been updated to 8.5 percent which is payable from the deposit date i.e. 31 March/30 September/31 December. The interest will be payable on 31 March/30 June/30th September and 31 December.
- The applicable rate of interest on Senior Citizen Saving Schemes deposit is 5 percent per year.
- The applicable rate of interest per quarter is 8.5 percent divided by 4 equals to 125.
- The accumulated interest for every Rupees 100 is Rupees 2.125.
- The accumulated interest for every Rupee 1 is 02125. (2.125/100).
An account holder for the SCSS can deposit multiples of Rupees 1000 which can’t exceed Rupees.15 Lakh, only once.
An account can be opened with cash if the amount is below Rupees 1 Lakh. If your deposit amount is above Rupees1 Lakh, the account can only be opened by cheque.
A premature closing of the savings account is allowed after a year only and the depositor will be charged 1.5 percent of his/her savings and 1 percent if it is closed after two years.
In case the interest amount is exceeding Rupees 10,000 each year, TDS would be deducted from the accumulated interest.
Wrapping it up
Being a savings oriented yet remunerative investment instrument, the senior citizen saving schemes’ rate of interest is locked at 8.6 percent per annum. Rather than putting their hard-earned savings either in the pretty low yielding savings bank accounts or high-risk alternatives such as mutual funds, it is wise for senior citizens to invest their money in the senior citizen saving schemes. It offers the senior citizens a platform option to invest their money in a high yielding, safe and widely popular savings instrument.
If you want to secure the overall well-being of your family members, buy the best family health plan for your loved ones and safeguard their health.
- Most Read
- Mediclaim Policy for Parents above 60 Years
Date: 20 July 2018
- Government Plans Health Insurance Scheme for Senior Citizens
Date: 16 July 2018
- New India Assurance Senior Citizen Mediclaim Policy
Date: 20 February 2018
- Star Health Insurance for Senior Citizens
Date: 13 February 2018
- Budget 2018: Insurance Benefits for Senior Citizens Raised
Date: 08 February 2018
- Health Insurance for Parents Above 55-60 Years
Views : 107491
- Best Health Insurance Plans for Senior Citizens in 2015
Views : 58490
- Health Insurance for Parents & Senior Citizen
Views : 45728
- Health Insurance Comparison Chart For Senior Citizens in India
Views : 31472
- Health Insurance Plans for Senior Citizens
Views : 19030