Senior residents want to preserve their cash safe, and like financial institution fastened deposits (FDs) and small financial savings schemes. These are thought-about low-risk devices. If we discuss senior residents’ FDs, aged folks get a further charge of curiosity that may go as much as 0.50% greater than most people. The authorities hiked rates of interest on the senior citizen financial savings scheme (SCSS) in April 2023. At current it’s providing an 8.2 per cent charge.
SCSS vs Senior Citizen Fixed Deposit: Which scheme scores higher?
Senior residents ought to give precedence to Senior Citizen Savings Schemes over Fixed deposits, stated Viplav Majumdar, Certified Financial Planner, Director, Planyourworld.com
“SCSS has a better curiosity of 8%, and this funding is roofed below tax saving funding u/s 80C. Whereas a senior citizen fastened deposit provides you a 7.5% return with out tax saving profit if the tenure is lower than 5 years,” said Viplav Majumdar.
Choosing between SCSS and Senior Citizen Fixed Deposit is like navigating the financial tides of retirement. “SCSS sets sail with higher interest rates, but its limited investment cap leaves seniors longing for more. Meanwhile, the FD banks offer a vast ocean of possibilities, supporting larger investments, and flexible tenures. The current may favor liquidity in FDs, but SCSS gracefully glides with quarterly interest payments. So, sail wisely, seniors, for your financial horizon awaits your prudent choice,” Amit Gupta, MD, SAG Infotech stated.
Whether it’s SCSS or Senior Citizen Fixed Deposit, returns from each investments are taxable within the fingers of traders.
“In each investments the true return after the deduction of Income Tax and adjusting inflation, the returns are unfavourable. Moreover, the curiosity is fixed for all of the years, however your bills develop always,” stated Certified Financial Planner Viplav Majumdar.
Lastly, the senior residents will really feel that their revenue from these devices is unable to match rising bills in years simply two to 3 years. So, they should plan their revenue sources by concentrating on optimistic revenue after adjusting revenue tax and inflation, he added.
The authorities made a number of adjustments to the Senior Citizens Savings Scheme (SCSS) in Budget 2023. Among these adjustments, the utmost funding restrict was raised from ₹15 lakh to ₹30 lakh.
Disclaimer: The views and suggestions made above are these of particular person analysts, and never of Mint. We advise traders to verify with licensed specialists earlier than taking any funding selections.
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Updated: 26 Jul 2023, 03:05 PM IST
