The central government’s small savings schemes are the best investment option with guaranteed returns. These schemes offer fixed returns for a specific period at an interest rate the central government determines.
Some popular schemes include the Sukanya Samriddhi Yojana for girl child, the Public Provident Fund (PPF) for employees, the Mahila Samman Savings Certificate for women, the Senior Citizen Savings Scheme for senior citizens, the National Pension System for retirement benefits, and more.
Notably, Sukanya Samriddhi and Senior Citizens Savings Schemes offer higher interest rates. Let’s analyze the returns on a 10,000 rupee investment in these schemes.
The government revises the interest rates of these schemes every three months, which may fluctuate based on inflation. For instance, the interest rates have remained unchanged as the RBI has not altered the key repo rates.
Let’s delve into the details of some specific schemes:
Public Provident Fund (PPF): The interest rate is 7.10 percent, and a minimum of 500 rupees can be deposited during the financial year. The maximum investment allowed is 1.50 lakhs.
PPF offers triple tax benefits without tax on investment, interest income, and maturity returns. Additionally, an investment in PPF can result in a tax reduction of up to 1.50 lakhs in a financial year.
Sukanya Samriddhi Yojana: Designed for girls under ten, this scheme offers an interest rate of 8.20 percent. The minimum investment required to open an account is 250 rupees, and the maximum investment allowed is 1.50 lakhs. The maturity period is 21 years after opening the account.
Three-year time deposit: This scheme offers an interest rate of 7.10 percent, and a minimum of 1000 rupees is required to open an account with no upper limit.
Five-year time deposit: This scheme offers an interest rate of 7.50 percent on a 10,000 rupee investment or 771 rupees per year.
Senior Citizen Savings Scheme: This scheme provides an interest rate of 8.20 percent. The minimum deposit is 1000 rupees, and the maximum is 30 lakhs. The investment should be made at once, and senior citizens are eligible.
- Monthly Income Account: With an interest rate of 7.4 percent, this scheme offers monthly interest accrual.
- National Savings Certificate: This scheme offers an interest rate of 7.70 percent, with a 10,000 rupee investment resulting in a maturity value of 14,490 rupees annually.
- Kisan Vikas Patra: The investment doubles in 115 months with an interest rate of 7.50 percent.
- Mahila Samman Savings Certificate Scheme: With an interest rate of 7.50 percent, a 10,000 rupee investment matures to 11,602 rupees.