A big downside of the scheme is TDS being deducted from the curiosity acquired on this scheme.
Senior Citizen Savings Scheme (SCSS) investments obtain 8.2% curiosity from banks and publish workplaces
The Senior Citizen Savings Scheme (SCSS) has been launched by the federal government to assist aged individuals save extra money for his or her later years. Anyone who’s no less than 60 years previous can make investments on this plan. The distinctive characteristic is that this authorities programme affords increased rates of interest than financial institution FDs. Investing in SCSS has many advantages, however there are some drawbacks as properly. Therefore, earlier than taking the plan, senior residents ought to pay attention to its advantages and downsides.
Senior Citizen Savings Scheme (SCSS) investments obtain 8.2% curiosity from banks and publish workplaces. For the quarter ending in April–June, the federal government raised the rate of interest from 8% to eight.2%. The rate of interest stays the identical after cash is put on this plan all through the length. From April 1, senior residents can make investments as much as Rs 30 lakh on this programme.
A big downside of the scheme is TDS being deducted from the curiosity acquired on this scheme. In distinction to the Public Provident Fund Scheme, TDS is imposed on SCSS funds that exceed the brink of Rs 50,000 in a fiscal 12 months.
Seniors now have extra funding choices than ever, because of SCSS’s present rate of interest of 8.2%, however those that opened accounts within the programme earlier when the rate of interest was decrease are at an obstacle. To make the most of the present increased rate of interest, they’ll shut their previous SCSS account and begin a brand new one in the event that they so select. However, the financial institution imposes some charges for the untimely cancellation of an SCSS account.
Only seniors who’re no less than 60 years previous can open a SCSS account. Employees within the personal sector who need to retire early aren’t eligible for this programme. Investments made in SCSS accounts have a 5-year lock-in time period with an extra 3-year extension. Some buyers is likely to be pressured to incur a loss due to the lock-in interval and the penalty for untimely withdrawal.
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