Senior Citizens: PMVVY or SCSS investment scheme, which one is best? (2024)

FAQs

Which post office scheme is best for senior citizens? ›

To sum it up, SCSS is a very good scheme for senior citizens who want a decent risk free return on a corpus fund. At 8% p.a. interest rate and an investment amount of Rs.30 lakh, the monthly income is stated to be Rs.20,000 per month for each investor.

SBI offers an additional premium of 30 bps over & above the existing 50 to Senior Citizen's on their retail TD for '5 Years and above' tenor only. "SBI Wecare” deposit scheme is valid up to 31st March, 2023. The interest rate offered on this special FD is 7.50% for senior citizens.

The government has recently increased the interest rates for the Senior Citizen Savings Scheme (SCSS) for the January-March quarter of FY2022-23. For investments made in the January-March quarter, the Senior Citizen Savings Scheme offers an interest rate of 8 per cent per annum.

Consequently, at least till the PMVVY investment matures (10 years), the senior citizen would be able to earn a return on an investment of Rs 15 lakh in Pradhan Mantri Vaya Vandana Yojana and Rs 30 lakh in the SCSS, i.e., on a total of Rs 45 lakh.

Bajaj Finance online Fixed Deposit offers one of the highest FD rates in India. Senior citizens get an additional rate benefit of 0.25% p.a. over and above the base rates. Making it a great option to grow your savings. You can earn up to 8.20% p.a. on your deposit.

What is the safest investment for seniors? Treasury bills, notes, bonds, and TIPS are some of the safest options. While the typical interest rate for these funds will be lower than those of other investments, they come with very little risk.

Senior Citizen Savings Scheme (SCSS) Investment Limit: For the quarter ending March 31, 2023, the government has raised the interest rate for the Senior Citizen Savings Scheme (SCSS) to 8%. What is Senior Citizen Savings Scheme? (i) An individual above 60 years of age.

The scheme will invite a deposit of up to Rs. 2 lakh at a fixed interest rate of 7.5% for the duration of two years. This means, one can earn an interest of Rs. 30,000 in two years for the maximum amount deposited.

TDS is applicable from the very first day when SCSS, 2004 was made operational regardless of the fact that the Central Government or Reserve Bank of India.

A depositor may operate more than one account under these rules subject to the condition that the deposits in all accounts taken together shall not exceed the maximum limit and provided that more than one account shall not be opened in the same deposit office during a calendar month.

How many times one can invest in SCSS? ›

Also, individuals can make a deposit only once, at the time of opening an account. Eligible individuals can start more than one account under this scheme. However, the deposit limit of all those accounts combined is also capped at Rs. 15 lakh.

Exactly what happens to elderly adults with no money? In most states, Medicaid will pay for a nursing home for up to 100 days. But the grim reality is that elderly folks who run out of funding in an assisted living facility will get evicted. That's a common experience and a potentially traumatic one.

It has a 5-year maturity period that can be extended up to an additional 8-year period. The interest rate on SCSS for the quarter ending March 31, 2022 is 7.4%. Account can be opened with a minimum deposit of Rs 1,000 or any amount in multiples of Rs 1,000, but not more than Rs 15 lakh.

The interest received under the scheme is taxable in the hands of the depositors. However, senior citizens can claim deduction under section 80TTB for the maximum up to Rs 50,000 in a single financial year.

PMVVY: the interest rate of this scheme differs according to different payout modes. SCSS: the interest rate for the quarterly payout mode is 7.4%. Therefore, the yield of SCSS exceeds that of PMVVY. Thus, SCSS is better than PMVVY.

Not all investment avenues come with tax benefits. This is an important factor to consider, especially for senior citizens. A financial product that does not come with tax benefit is the Pradhan Mantri Vaya Vandana Yojana (PMVVY), a well-known pension scheme operated by the Life Insurance Corporation of India (LIC).

(3) In case of death of a depositor before maturity, the account shall be closed and deposit refunded on an application in Form 'F' alongwith interest applicable to the scheme till the date of death on which the depositor expired, to the nominee or legal heir in case the nominee has also expired or nomination as ...

These schemes – Senior Citizens Savings Scheme (SCSS) and Pradhan Mantri Vaya Vandana Yojana (PMVVY) offer higher rates of interest than prevailing FD rates.

1. Which government scheme gives the highest rate of interest? At present, PPF investments offer 7.1% returns on your investment. They have a maturity of 15 years, and the interest rates are compounded and redeemed on maturity along with your principal.

What is the best retirement portfolio for a 70 year old? ›

Bonds. As previously mentioned, many fund managers would recommend having a portfolio heavily invested in bonds in your 70s. Bonds are a good investment class when you're in your 70s as they help preserve capital while also earning interest.

Here are the best low-risk investments in March 2023:

Money market funds. Treasury bills, notes, bonds and TIPS. Corporate bonds.

Quick Look at the Best Investments for Retirees:

Mutual Funds. Municipal Bonds. Stocks. ETFs (Exchange-Traded Funds)

Note: SBI has introduced a tenor specific term deposit scheme (Amrit Kalash) for domestic and NRI customers. Under this scheme, SBI offers special FD interest rates at 7.10% p.a. to the general public and 7.60% p.a. to senior citizens for the tenure of 400 days. The validity of the said scheme is till 31 March 2023.

The interest rate for SBI Senior Citizen Fixed Deposit Scheme is 7.40% per annum, effective from 1 April 2020.

Markets now view it as probable that the Fed Funds rate reaches 5.25% to 5.50% in 2023.

The popular fixed deposit scheme provided by Post Office Savings Bank offers depositors interest rate from 6.60% to 7%.

Documents to be Submitted

Proof of identification, such as passport or Permanent Account Number (PAN) Card is required. Individuals are expected to submit proof of address, such as an Aadhaar Card or a phone bill. Age proof, such as a PAN Card, voter ID, birth certificate, passport, or senior citizen card.

How can senior citizens avoid 10% TDS on fixed deposit? ›

If your interest income from all FDs with a bank is less than Rs 40,000 in a year, the bank cannot deduct any TDS. The limit is Rs 50,000 in the case of a senior citizen aged 60 years and above. Prior to Budget 2019, the limit of TDS on interest income was Rs. 10,000.

Also, u/s 194A of the Income Tax Act, no Tax is Deducted at Source (TDS) on interest payment of up to ₹ 50,000 by the bank, post office or co-operative bank to a Senior Citizen.

In this scheme, a person is allowed make only one investment. Since multiple investments in a single account are not allowed, Senior Citizen Saving Scheme allows investors to open multiple account. In a single account, the maximum deposit allowed is INR 15 lakhs while the minimum investment allowed is INR 1,000.

(6) Every nomination and every cancellation or variation thereof shall be registered in the deposit office and shall be valid from the date of such registration, the particulars of which shall be entered in the pass book.

To sum it up, SCSS is a very good scheme for senior citizens who want a decent risk free return on a corpus fund. At 8% p.a. interest rate and an investment amount of Rs.30 lakh, the monthly income is stated to be Rs.20,000 per month for each investor.

While the depositor can open a new SCSS account after the maturity, however, the depositor has the option to extend the maturity by three years. For extending the maturity of the SCSS account, the depositor needs to submit the request in the prescribed form within one year from the date of maturity.

An individual can open multiple SCSS accounts, but the total deposits in all the accounts combined should be, at most, the maximum limit of Rs. 15 lakh. It is essential to note that only one deposit is allowed per account.

Living on Social Security alone is not only possible, but many retirees already accomplish that very feat every year. While the lifestyle associated with Social Security income isn't exactly luxurious, it doesn't have to equal rice and beans for the rest of your life, either.

According to data from the Federal Reserve's most recent Survey of Consumer Finances, the average 65 to 74-year-old has a little over $426,000 saved. That's money that's specifically set aside in retirement accounts, including 401(k) plans and IRAs.

What state has the most affordable housing for seniors? ›

Investment made in SCSS are also eligible for tax deductions in the following manner: The principal amount deposited in SCSS is eligible for a tax deduction of up to Rs. 1.5 Lakh per annum under section 80C of the Income Tax Act, 1961. Interest on SCSS is taxable as per the tax slab applicable to the person.

Post office schemes for senior citizens

Senior Citizen Savings Scheme (SCSS): A savings scheme with a tenure of 5 years that offers an interest rate of 7.4 per cent per annum. The minimum investment amount is Rs. 1,000, and the maximum investment limit is Rs. 15 lakh.

Senior Citizens Saving Scheme (SCSS)

After hike the Senior Citizen Savings Scheme (SCSS) has an interest rate of 8.0% per annum for the fourth quarter of FY 2022–23. Anyone over the age of 60 is eligible for this programme.

What should a 70-year-old invest in? The average 70-year-old would most likely benefit from investing in Treasury securities, dividend-paying stocks, and annuities. All of these options offer relatively low risk.

Tata Retirement Savings Fund is a carefully structured suite of plans designed to meet the investment needs of investors planning for retirement. It works as a retirement solution by offering choice of asset allocation to investors based on their life stage and risk preference. Long Term Capital Appreciation.

What is the interest of 5 lakh in post office for senior citizens? ›

For example, Amount Invested is Rs.5 lakh. Annual Interest Rate is 7.1% p.a. Tenure is 5 years.

For longer tenures, the five-year post office time deposit is now offering 7% as compared with SBI's 6.25% for five years and up to 10-year fixed deposits. Deposits on Senior Citizen Savings Scheme (SCSS) will now fetch 8% which is higher by 50-75 basis points offered by banks to senior citizens.

Senior Citizen Savings Scheme (SCSS) Investment Limit: For the quarter ending March 31, 2023, the government has raised the interest rate for the Senior Citizen Savings Scheme (SCSS) to 8%. What is Senior Citizen Savings Scheme? (i) An individual above 60 years of age.

One can invest a maximum of Rs 15 lakh in Senior Citizens' Savings Scheme (SCSS) in their individual capacity. But one can hold a joint account with one's spouse, where the spouse has to be a first holder, and deposit another Rs 15 lakh. So, effectively, one can deposit a maximum amount of Rs 30 lakh.

Well-known schemes are Public Provident Fund (PPF), Kisan Vikas Patra and Sukanya Samriddhi Yojanas. The government has made these small savings schemes available via post offices to provide a safe investment avenue for the public by providing good returns and keeping their investments safe.

Does the interest earned from SCSS qualify as part of the Rs 50,000 deduction in interest income that's meant for senior citizens? Archit Gupta CEO, ClearTax replies: Interest of up to Rs 50,000 received from this scheme will be eligible for a deduction under Section 80TTB of the Income-Tax Act.

Section 80C of the Income-tax Act, 1961 allows for a deduction for contributions to SCSS. This tax benefit, however, is limited to the present annual limit of Rs 1.5 lakh for all investments made under section 80C. The interest received under the scheme is taxable in the hands of the depositors.