Retirement is a major life transition through which a person goes from his productive working years to the non-productive post-working years when one mostly lives a laid-back life. Towards the end of their working career, many people develop a concern for how they will make ends meet in their old age. To overcome this issue, the Government of India came up with the Senior Citizen Savings Scheme (SCSS) in 2004. The Senior Citizen Savings Scheme is a government-sponsored saving and investment plan only for senior citizens who are over 60 years of age. In this blog, you will come to know about the Top Five Perks of the Senior Citizen Savings Scheme.
High Rate of Interest
The government offers a comparatively high rate of interest, which is the main strength of the Senior Citizen Savings Scheme. Usually, the rate of interest on the SCSS is higher than some of the regular fixed-income investment products available in the market. Currently, the rate of interest offered on the SCSS is 7.4% per annum, compounded at quarterly rests. This rate may vary depending on the current market circumstances, and it is changed now and then. The interest rate being offered by the SCSS gives the senior citizens good returns that translate into the provision of their financial needs after they retire.
Minimum Investment Limit & Maximum Investment Limit
The Senior Citizen Savings Scheme has reasonable minimum and maximum limits of investment so that senior citizens can easily invest in the scheme. The investment amount under the SCSS is that it has an investment minimum of Rs. 1,000 and a maximum of Rs. 15 lakhs. This provision allows citizens, depending on their financial ability in senior age, to invest in the scheme so that they can meet their needs financially in their golden years.
Simple and Uncomplicated Operation
The investment under the Senior Citizen Savings Schemes is easy and does not include a tedious process. The senior citizen can invest in the scheme by visiting the nearest post office or any branch of the nationalized bank. They will have to complete an application and attach other particulars about them, such as age and identification details. At the end of the quarter, the interests are rebated and the invested amount is debited to the individual’s account.
Safety and Security
Indeed, one of the main benefits associated with this investment option is that the Senior Citizen Savings Scheme is a safe investment option. The SCSS is said to be a government-sponsored scheme; this means that the amount one invests as well as the interest portion will be not only complete but safe. The scheme provides a payback assurance; this means that the investors will earn a fixed ratio of interest on the invested capitals, thus reducing other risks involving other investment prospects.
Extension and Loan Facility
The Senior Citizen Savings Scheme also has an extension and loan facility, which make it among the preferred investment instruments for seniors. In the extension facility, the lock-in period in the SCSS extends for two or three years more after the termination of the initial mandatory five-year period. The investors can extend their investment by applying for the same in the concerned post office or the branch of the bank where the investors have opened their SCSS account.
However, a year from the day of deposit, the scheme enables the investors to get a loan of up to 75% of the deposited amount. This loan facility is especially popular among senior citizens who may need cash for some reason.
Conclusion
For elderly people who want financial security during their retirement years, the Senior Citizens Savings Scheme (SCSS) is the perfect investment option. It provides senior citizens an opportunity to earn high interest rates on their savings, which is a significant advantage over other traditional savings plans, and is also beneficial because of its multiple advantages: it is inexpensive to set up, easily accessible anytime and anywhere, labor-saving, requires little understanding of investment, does not interfere with any savings in provident funds, and so on. The scheme also allows investors to invest a minimum and maximum amount depending on their financial situation. Its easy-to-use application process, coupled with the fact that it will safely and securely secure your investment, makes it a convenient option for seniors looking to protect and grow their savings. Also, SCSS has a couple of more features, such as that it can be extended, and in case you opt to borrow a loan against the investment, you can easily do so. All these features ensure senior citizens invest safely and on their financial needs changing.
With investment in SCSS, seniors can provide themselves with a steady flow of income through the whole of their retirement, thus eliminating the need to anticipate tough financial times and therefore living a life free of work stress. However, if your seniors prioritize the safety, simplicity, and reliability of their investment, the SCSS is one of the safest, hassle-free options. It is the perfect solution for senior citizens who wish to free themselves from any fear of financial dependence during those golden years.
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