Sukanya Samriddhi Yojana: A Path to Tax-Exempt Millionairehood for Your Girl Child
Sukanya Samriddhi Yojana (SSY) has emerged as a significant initiative by the central government, aligning with the 'Beti Bachao Beti Padhao' campaign. Launched in 2015, this scheme is designed to foster financial security for the girl child, coupled with the added advantage of tax exemptions under Section 80C of the Income Tax Act upon maturity.
As we navigate through the intricacies of the SSY scheme, it becomes evident that its impact goes beyond mere financial savings. The central government, in its recent declaration of interest rates for the fourth quarter of the fiscal year, has set the SSY interest rate at an enticing 8.2 percent. Although this rate is subject to quarterly adjustments, a prudent estimate suggests a net return of approximately 8 percent upon maturity.
Let's delve into the numbers to understand the potential growth. Imagine an individual, upon the birth of their girl child, starts investing ₹12,500 per month or ₹1.50 lakh per annum in an SSY account. By the time the girl turns 21, this disciplined investment approach could accumulate a substantial fund of around ₹69 lakh. An added advantage lies in the fact that the investor can claim income tax exemption on the ₹1.50 lakh invested in the SSY account within a financial year, courtesy of Section 80C.
For those seeking a more strategic approach, the Sukanya Samriddhi Yojana calculator proves to be a valuable tool. Assuming an investor initiates contributions immediately after the birth of their girl child, they can continue depositing funds for a period of 15 years, until the girl attains the age of 14. At this juncture, the investor gains the option to withdraw 50 percent of the maturity amount when the girl turns 18, with the remaining amount accessible when she reaches 21. Alternatively, the investor can choose to withdraw the entire amount after the girl turns 21, bypassing the earlier withdrawal at 18.
With an anticipated 8.2 percent return at maturity, an investment of ₹12,500 per month or ₹1.50 lakh upfront can maximize the income tax benefit under Section 80C in a single financial year. In the scenario of a full withdrawal at the age of 21, the SSY maturity amount is estimated to be a substantial ₹69,32,648 or ₹69.32 lakh.
It is fascinating to note that this investment strategy, starting with ₹12,500 per month, has the potential to transform the girl child into a millionaire by the age of 21, illustrating the long-term financial empowerment that the Sukanya Samriddhi Yojana offers.
Beyond the financial gains, SSY also brings notable income tax benefits into play. Investors can claim tax benefits on investments up to ₹1.50 lakh in a single financial year under Section 80C. Moreover, both the interest earned and the maturity amount under SSY are 100 percent tax-exempt, rendering Sukanya Samriddhi Yojana an EEE (Exempt, Exempt, Exempt) investment instrument.
In essence, Sukanya Samriddhi Yojana stands not only as a strategic financial planning tool but also as a testament to the government's commitment to empowering the girl child, ensuring a secure and prosperous future. It exemplifies the synergy between financial prudence and societal progress, embodying the spirit of 'Beti Bachao Beti Padhao.'
