Now when it comes to finances, people who have realized the pace at which cost of education and inflation is growing are becoming proactive and have begun to accumulate for various financial goals including those for their girl child. And in this regard, government has also come to rescue with the roll-out of an exclusive scheme called Sukanya Samriddhi Yojna under Beti Bachao Beti Padao initiative for a girl child.
But, here is a low-down on which scheme fares better for accumulating handful funds for your daughter's future expenses in terms of liquidity and other parameter such as returns.
In Sukanya Samriddhi account, parent or guardian can open the account for their girl child until she turns 10 years of age and the proceeds of the account can be put to use only when the account completes 21 years from the account opening date or whenever the girl is married, which ever is earlier, subject to the following:
It is also provided that where the marriage of the account holder takes place before the completion of such period of 21 years, the operation of the account will not be allowed beyond her marriage date. Also, when the SSY account is being closed before the completion of 21 years, an affidavit has to be attached mentioning that the girl child has attained maturity and is not below 18 years of age as on the account closing date.
On maturity, the balance, including the interest outstanding in the account, will be payable to the account holder on the production of withdrawal slip along with the passbook.
Here, one needs to understand that the higher return benefit on SSY account of 50 basis points more i.e. 8.5% more can lure a guardian or parent to open SSY account. One cannot ignore the long period for which the investor needs to remain invested.
So, while SSY is an asset investment targeted particularly for future financial needs of a girl child. Investments including PPF and other such as equity based products can be added to one's investment basket until one requires them so, as PPF funds allow pre-mature withdrawal after 5 years of account operation in case of certain events. And complete withdrawal is allowed after 15 years and can also continue the PPF account further in blocks of 5 years.
In SSY account, only 50% of the SSY balance can be fished out and the rest can be withdrawn only after the daughter turns 21 years in age.
Also, experts suggests investors to not solely depend on this debt based product (SSY) and instead opt for the product in combination with other equity based products to beat inflation rate.
Nonetheless, one cannot ignore the very fact that the withdrawals from the SSY account cannot bee made for any other purpose besides daughter's education and marriage and hence it is a dedicated investment targeted at a specific goal.