The biggest benefits is that you get tax benefits under section 80 C, And 2nd, you get high interest rates, you get interest more than all your Debt saving schemes like PPF, EPF. Now definitely only those people can invest here who have a girl child, If you have a girl child and you want to invest in the debt instrument, then this can be a very good option for you.
First of all, let’s talk about account opening, for whom this account can be opened? So this account can be opened for any Indian resident girl child, you can’t open it if you are an NRI. The age of your girl child should be between 0-10 years, if more than that, then you can open an account in that case, you can open this account in any post office or authorized bank, it’s can be opened in all the popular banks like SBI, ICICI, AXIS Bank. So you can open in any of those, and if shift from your location in India, let’s say from Delhi to Mumbai, then you can transfer this account, if you open an account in any post office and want to transfer it to a bank, then is also possible, Secondly, keep in mind that you can open only one account per one girl child, And maximum of 2 accounts can be opened in a family for 2 girl children. Thre are some exceptions in this, accounts can be opened for 3 girl children also but only in case if you had twins in the second birth or triplets in the first birth, In these cases, 3 accounts can be opened, and this account can be opened with Rs.250. Earlier it used to be Rs. 1000 but not anymore, for opening an account, you need normal documents like, the birth certificate of your daughter, address and id proof, you need to fill a form and some photographs.
About investments, the minimum amount which you have to deposit per year is Rs. 250 and the maximum can be Rs. 1.5 lakhs. The questions arise that should we deposit the same amount every month or can we deposit a single amount in a year, No! there’s no such limit and you can deposit Rs. 1.5 lakhs anytime in any number of portions. Deposit and maturity periods, so the deposit period is 14 years from the date of opening of the account, that means, if you opened an account in 2023, then you can deposit money till 2036. You can invest up to Rs.1.5 lakhs each year, and secondly, its maturity occurs 21 years form the date of opening of the account, so many people get confused between maturity and deposit period. People think that they can invest till their daughter reaches the age of 14 years old, and they have to withdraw when she reaches the age of 21 years old. It’s not like that, if your daughter’s age is 5, then form here you have to count 14 years, so 5+14, that means you can invest till she’s 19 years old, and 5+21, that means you’ll get that amount when she’s 26 years old.
About the interest, here, you get interest more than PPF (Public Provident Funds), In today’s date, the interest rate in PPF is 7.1% whereas, in Sukanya Samriddhi Scheme, it’s 8%. So you can assume that you’ll get 0.9% more interest than PPF. And since it changes quarterly, so in each quarter, the government decides the interest rates for all schemes, and the compounding of interest rate happens annually and you don’t get any interest after its maturity, so as it reaches maturity, you should withdraw your money after 21 years, and then you can invest that amount somewhere else for your daughter.
About the Tax benefits, it comes under the Exempt Exempt Exempt (EEE) category, so that means you get a rebate on the invested amount under section 80 C. Secondly, there’s no tax on the interest you earned, so no tax on the interest on investment during the time, and no tax on the final withdraw corpus amount as well, now because there are tax benefits and good interest rate here, I would say that give the best returns amount all the debt instruments.
About the Withdrawal of Money, you can withdraw money only 2 cases, 1. Higher education of your girl child, that means when she’s going to collage and she reached the age of 18 years, The minimum age should be 18 years then only you can withdraw money. 2. Now 2nd cases is Marriage. Now if you want to withdraw from higher education, so you can withdraw up to 50% of the total corpus formed, if you want to withdraw at the age of 18 years, so the total amount in the previous financial year, i.e., 10 lakhs, so you can withdraw 50% of it, that means Rs.5 lakhs, but in the case of marriage, you have to close this account, If the maturity of 21 years is not completed and you daughter is married before that, then you need to close the account and you’ll get all the money. So ultimately this is the purpose of this account, it promotes the higher education of girl child and helps at the time of marriage. And that’s why this scheme was created.
If want to close this account in between then is it possible? See, generally, it’s not possible, you can only close this account in 2-3 cases. 1. In the unfortunate case of death of the girl child, 2. Emergency in the family such as life-threatening disease to girl child, 3. If the status of the girl child changes to NRI or her citizenship changes to another country. But in reality, these cases are rare so you can assume that you cannot withdraw this amount.
Many people say that we cannot afford this much and cannot deposit this much amount, so in that case, you can stop your investments, and you can deposit the minimum amount which is Rs. 250. It’s not much amount so you can deposit that, at least you’ll get the benefit of interest otherwise you get interest of only a savings account. So keep depositing the minimum amount every year. And if by chance, you didn’t deposit money for a few years, in that case, you account will be deactivated, and you’ll only get interest of the savings account. But if you want to revive it, it can be done by paying Rs. 50 as the penalty, plus all your arrears, whatever were your years of defaults, Let’s say 5, so 5 x 250 + 50 penalty is what you need to pay and revive this account. Besides that, the question arises that if the age of the daughter is above 10 years, then can we invest in this scheme? See you cannot invest in this scheme, but this is not the only scheme for investment. You have many other instruments like you can invest in equity. There also you get tax benefits with good returns. You can invest in PPF, National Saving Certificate, FD’s. there are many options for investing so analyze what be suitable for you. See the calculations that how much money can we get with how much investments? Lets’ say you invested Rs. 50, 000 in any year, next year you invested Rs. 1,00,000 and Rs. 10, 000 only in some other year.
