Seniors Savings Plan: Ensure Financial Security with THIS Plan – Check Eligibility, Investment, Interest Rate, Exit Option and Other Details Here

Saving money for the future is one of the most important things a person should do as soon as they start making money, especially for financial security in old age and after retirement. .

If unplanned, retirement brings uncertainty. However, there are savings products that are safe and provide guaranteed retirement income. The Senior Citizen Savings Scheme (SCSS), launched in 2004, is a deposit system introduced by the Indian government to provide guaranteed returns to seniors through safe investment. This plan provides regular income to retired seniors.

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Recently, the Punjab National Bank (PNB) tweeted: “Savings scheme for seniors guarantees your future financial security”.

If you are interested in signing up for this program, here is all you need to know:

Eligibility: You must be a retired Indian Resident to open an account

Entry age: 60 years. The entry age is 55 for those who have retired with a retirement pension or under a voluntary or special voluntary scheme. Retired defense service personnel (excluding civilian defense employees) will be eligible to invest at the age of fifty, subject to the fulfillment of specified conditions.

Investments: The minimum investment can be Rs 1000 while the maximum is Rs 15 lakh. Deposits must be multiples of Rs 1,000.

The interest: Interest applicable from time to time in accordance with Indian Government guidelines. Interest will be payable from the date of deposit until March 31 / June 30 / September 30 / December 31 on the 1st working day of April / July / October / January as the case may be, initially and thereafter , interest will be due on the 1st working day of April / July / October / January.

Account maintenance categories: Individual, Spouse with spouse. A nomination service is also available.

Guarantees of interest: The interest rates for this program will be notified by the Ministry of Finance / Reserve Bank of India by April 1 of the same year and are aligned with the G-Sec rates of similar maturity.

Liquidity: The SCSS is liquid, despite the expected 5-year freeze. Liquidity is offered in the form of withdrawals subject to conditions and penalties.

Exit option: Premature closure of the account is authorized with a penalty. The ability to pledge the deposit to the SCSS account to obtain loans is not allowed as it defeats the goal of regular income.

The withdrawal or premature closure of the SCSS account is authorized after one year from the date of opening the account after deduction of a penalty for early withdrawal or closure which varies from 1 to 1.5 percent depending on the period of validity Account.

If the account is closed after the first year and before the end of the second year, an amount equal to 1.5 percent of the deposit will be deducted as a penalty.

If the account is closed as of the second year, an amount equal to 1 percent of the deposit will be deducted.

Tax implications: Interest earned on the deposit is fully taxable and tax is withheld at source (TDS) in accordance with applicable income tax rules. However, if the income is not taxable, you must provide form 15H or 15G so that no tax is withheld at source.

How to open an account?

Open a savings account with a SCSS account and you will need the following documents to present at the branch counter:

1. An account opening form that the branch will provide.

2. Two passport size photographs.

3. Address and identity document such as copy of passport, PAN card (permanent account number) or declaration in form No. 60 or 61 according to the Income Tax Act 1961, a driver’s license, voter ID card or ration card.

4. A copy of the Aadhar card must be submitted when opening the account.

5. Bring original proof of identity for verification when opening the account.