Senior citizens have to maintain a corpus large enough that will bear the brunt of investment losses and also sustain their livelihood in the golden years. This makes senior citizens the most vulnerable segment of investors who are most risk-averse and keen on finding alternatives with a high degree of safety, even to the extent of compromising on return on investment. Since the main source of income is over now, multiplying the existing corpus with safety is of the essence. There are many government and private schemes which aim to fill this gap for senior citizens. Yet, one of the newest and most sought after scheme has been Senior Citizen Savings Scheme. If you are looking for Kerala Board information then u’ll visit at HSS Live.
It is a retirement scheme floated by the government of India to help senior citizens have an option of investment with high interest rates after retirement as well. Most investment options, if you notice, tend to be for retirement benefits but expire on actual retirement – Employee Provident Fund has a life only till the retirement of the employee, Public Provident Fund has a life of 15 years maximum with only two extensions of 7 years allowed. Post Office Schemes are again up to the age of 60 years. These schemes left a gaping hole for people who were retired but needed to sustain their corpus by the onslaught of inflation and earn returns high enough to sustain their longer life.
Thus was born the Senior Citizen Saving Scheme(SCSS) which offers capital protection and high interest rate. However, not everything is for everyone. It is essential to study the features of this scheme to understand how much does it fulfill your purpose. Let us look at various things that you should know before you consider investing your hard-earned money into this scheme.
- Basic features of SCSS – It is only for people above the age of 60 years. It comes with a sovereign guarantee with quarterly payouts. It minimizes the tax outgo as well. The purpose is to bridge the gap between the pension and the last drawn salary.
- Investment – People in early retirement period (55-60 years), who have just received their VRS or retirement and EPF/PPF amounts, can invest in SCSS provided they do it within a month of receiving the benefits.
- Eligibility – Defence personnel above the age of 50 years can invest, and non-resident Indians (NRIs) and Hindu Undivided Families (HUFs) are not eligible to invest.
- Interest Rate – The interest rate payable is decided each quarter by the government of India under post office schemes interest rates. The rates for Jan-Mar 2019 quarter were 8.6%. However, the good news is if your investment has been locked at a particular rate, it will not change, even if the government reduces the rates in the coming quarters. Only if you extend the investment beyond maturity, then the new prevailing rate will be applicable. There is no cumulative option here like a bank or company FD. The interest is payable each quarter.
- Tenor and Maturity -The tenor of the scheme is 5 years after which it can be extended only for three years more. In case you do not close the account or extend the scheme, then it will get converted into a post -office FD, and the interest rate will change accordingly.
Once you have taken advantage of this scheme, you still need a High return investment option. Consider company FD like Bajaj Finance FD, which comes with the credibility of world-renowned credit rating agencies like CRISIL and ICRA (FAAA/stable rating and MAAA/stable rating, respectively). It pays out higher interest rates than any other company FDs.
You can use multiple features like debit card, auto-renew, online FD calculator, multi-deposits through a single payment, and much more.
Thus, these five facts should give you a good idea of SCSS before you move to company FDs.