The Sukanya Samriddhi Yojana is an initiative by the Government of India to promote the financial security for the girl child across the country. This scheme has encouraged the parents of the girl child to come forward and join this mission to provide with their girl child a better future in terms of financial security by investing in Sukanya Samriddhi Yojana scheme. The purpose of this scheme is solely meant for meeting educational and marriage expenses. This scheme is also known as the part of Beti Bachao Beti Padhaoscheme.In recent times I received many requests from my blog readers to write a blog post on Sukanya Samriddhi Yojana and its benefits. Therefore today, I have decided to publish a blog post on Sukanya Samriddhi Yojana and Sukanya Samriddhi Yojana calculator.
Sukanya Samriddhi Yojana Features:
A Sukanya Samriddhi Yojana Account can be opened up to the maximum age of 10 years of a girl child from the date of her birth by her parents;
Maximum two (2) Sukanya Samriddhi Yojana Account can be opened by parents of girl children in different two names;
Contribution in this account can be made for the maximum period of 15 years from the opening of the account;
This account is closed mandatorily when the account attains the age of 21 years from the date of opening.This means this account remains in operation for maximum of 21 years from account opening date. Since the maximum period of contribution in this account is 15 years, no contribution is required to be made between 16th to 21st years;
As per the new amendment rules 2018, the minimum amount required to open Sukanya Samriddhi Yojana account is now Rs. 250 only from earlier Rs.1000;
Also, as per the above amendment rules 2018, the minimum amount to be deposited per year for maintaining this account has been reduced to Rs. 250 from earlier minimum threshold limit of Rs. 1000;
The maximum amount that can be deposited in Sukanya Samriddhi Yojana account in a year is Rs.1,50,000;
Contribution in this account is exempted from tax up to a maximum limit of Rs.150000 per annum U/S 80C of the Income Tax Act, 1961;
Though the current rate of interest offered by this scheme is 8.1% per annum compounded annually, the interest rate is reviewed like other Small Saving deposit schemes on the quarterly basis;
The interest rate offered bySukanya Samriddhi Yojana is still higher by the other Small savings deposit schemes like PPF, FD and Recurring deposits;
Premature closure of this account is permitted on the girl child attaining the age of 18 years only for education and marriage purposes;
Only 50% of the last financial year’s accumulated balance can be partially withdrawn for the above mentioned two purposes;
The girl child is the only authorised person to withdraw the balance on attaining the age of 21 years i.e. at the maturity;
The benefits of Sukanya Samriddhi Yojana are many so as to ensure better future for the girl children and parents do not consider the girl child as a burden on them. The benefits of SSY is given below.
The highest rate of interest (Currently 8.10% for F.Y 2017-18) offered by SSY account in comparison with other small savings deposits schemes such as PPF;
Investment in Sukanya Samriddhi Yojana account is totally tax exempted U/S 80(c) of the Income Tax Act 1961 up to Rs.150000/- per year, and is of EEE category i.e. Exempted, Exempted and Exempted;
The maturity proceeds can only be withdrawn by the girl child and no one else. Thus women after 21 years of age do become financially independent;
With a mandatory lock-in period, money cannot be withdrawn before the girl child attains 18 years of age, as a result, a substantial amount can be received at maturity;
Being a purposeful investment avenue parents are not required to bother much about girl children higher education and marriage;
This is a social security scheme for the girl children across India and is very easy to operate;
Drawbacks/ Disadvantages of Sukanya Samriddhi Yojana :
Every new financial product comes with certain drawback so does Sukanya Samriddhi Yojana account.
The lock-in period is very high i.e 21 years. This means parents can not withdraw any amount before maturity for any reason;
The rate of interest offered by Sukanya Samriddhi Yojana is not fixed and are fixed on a quarterly basis from now on. This is the biggest drawback of this scheme. The interest rate is being reduced day by day drastically;
No premature withdrawal is permitted. This means at the time of an unprecedented situation you can not withdraw amount contributed to this account;
In case of partial withdrawal when the girl child attains 18 years of age, only 50% of the accumulated corpus in preceding financial year is permitted to be withdrawn for the purpose of higher education and marriage of the girl child;
In the era of internet, contribution to Sukanya Samriddhi Yojana account cannot be done via online mode. Parents have to deposit the contribution over the counter either in Post Office or designated banks;
Sukanya SAmriddhi Yojana Calculator in Excel
To download Sukanya Samriddhi Yojana Calculator in excel click the following link Sukanya Samriddhi Calculator in excelHere, you need to put the values only in Input cells. The remaining calculations would be done automatically. Here, I have utilised two formulae for this calculation. I have used Rs. 1000 as contribution per year and investment period as 14 years. Also, the rate of Interest is taken as 8.1% which is selected for F.Y 2017-18. So, in the excel calculator, you just need to put the values for investment amount and investment tenure.Just remember that the maximum investment period has been enhanced from 14 to 15 years and maturity remains at the age of 21. So instead of 14 years, you can provide in the input cell as a maximum 15 years. So from the basic investment of Rs. 1000 for 14 years we can see that the maturity amount comes to Rs. 45477. Now if you just multiply the investment amount by 2, the maturity amount comes to Rs. 90594.As you can see that this Sukanya Samriddhi Yojana is providing a much superior return as of now as compared to Recurring deposits and Fixed deposits.
Should you invest in Sukanya Samriddhi Yojana account
In my personal opinion, parents of girl children should consider starting investing in this SSY account. The reasons for my assertive opinion is listed below.
This Sukanya Samriddhi Yojana provides a better return from the Country’s best small saving deposit i.e Public Provident Fund or PPF. Therefore, those parents who are already investing in PPF keeping girls children future in mind should immediately shift some funds to SSY account.
Conservative investors, who are a little bit scared of taking financial risk, this SSY is best suited for them. The returns are currently 50 basis points higher from the 10 years Government of India Bond.
Before, Union Budget 2018, Equity Linked Savings Scheme used to enjoy EEE status. But from this fiscal year, it lost that status. So, currently, only Sukanya Samriddhi Yojana and PPF are enjoying the EEE status.
Also, investment in Debt mutual funds does have Long Term Capital Gain Tax with indexation benefits. But for some of the best debt mutual funds, the effective earning becomes less than 8%. So in that scenario investment in SSY becomes worthful.
Those, who invest regularly in PPF for accumulating wealth for the future of girl children for their higher education and marriage. This has led them to be tension free to some extent;
Final word on Sukanya Samriddhi YojanaI hope I have done enough justice on today’s blog post on Sukanya Samriddhi Yojana and Sukanya Samriddhi Yojana calculator. I have tried my best to bring forth all the details in a very simple and lucid manner. I would personally, suggest parents to go for this scheme in order to facilitate a better and secured future of the girl children across India. Let’s hope that this mission would help every parent of a girl child to provide their queens with a new horizon.