The government in a bid to empower girls in the Indian society has been doing all its bit to enable parents save a substantial amount that can come in easy at the time of higher education or marriage. And to make the most of the SSY scheme, you as a parent or guardian of your child need, needs to invest in the early in the life of your daughter as the compounding then will boost your accumulated wealth for the sole purpose.
In the recent small-savings scheme interest rate revision, interest rate for SSY scheme has been increased to 8.5% per annum.
Also, in order that parents do not face any headwinds in respect of the minimum amount, in the Sukanya Samriddhi Account (Amendment) Rules, 2018, the minimum deposit amount under the scheme has been reduced to Rs. 250 per year from Rs. 1000 earlier.
So, given the scenario wherein girls need to equipped well in all facets of life, do all parents with a girl child need to bet on the scheme for saving for their daughters is the question that comes up straight away. And here is a quick answer to the raised question.
Investing early in the scheme pays-off : Parents having girl child in the age group of 0 to 10 years can park money in the scheme and as the lock-in is higher, investors (parents or guardians) will not be able to withdraw funds for any other short term needs. Investments in the account made for 15 yeas from the account opening date and the account attains maturity after 21 years.
It is to be noted after 15 years, investments cannot be further made, though the interest component on the scheme is earned. Also, if withdrawals are to be made, it Is entertained by the authorities only when the child attains 18 years of age.
So, investors considering the inflation rate and cost of higher education, can consider it as a back-up plan in addition to other investments and expect to make up some 50% of the total cost that might be involved in your child's higher course etc.
Safety is the key: As it is a sovereign backed scheme, investors can rest assured and there is unlikely to be any default in such schemes as is the case in some of the investments in the current scenario. Also, there is tax benefit with no tax implication on the interest component as well as maturity proceeds from the scheme.
Investment horizon aligns with the varied investment goals: The scheme is conceived in such a way so that investors if they start early via the scheme, can look at the corpus thus accumulated for her higher education or as else if not for education, it can be to secure her future altogether. It is to be noted that withdrawal in case of emergencies or some particular goals is allowed to the extent of 50% of the balance as and when the daughter turns mature.
Also, the account is locked-in for 21 years after the account is subscribed for. So, well planned financial exercise via Sukanya Samriddhi scheme can go a long way in doing justice to your daughter financially.