Senior citizen Saving Scheme is a great step today

Numbers of senior citizen readers have written to us asking whether Governament of India's SCSS has been withdrawn ? Or is it still in vogue ? Do investments in the scheme are still profitable to retired persons even now?

I would like to emphatically state for any retired person, as on date, SCSS is one of the best scheme to invest, especially during he present time whem al he banks have lowered down the interest rates on deposits. Some of the senior citizen could not decide where to invest their money on maturity. One lady wrote that she stayed invested for last three years in a NATIONALIZED BANK wit an annual return of 9.5%. On maturity of the FD CERTIFICATE the same bank is offering her much lower rate of interest bringing her annual income. She is asking where she can invest with higher interest rate? Another gentleman was old by the BANK THAT Senior citizen scheme with higher interest is withdrawn. This not a fact .GOVERNMENT OF INDIA'S scheme is still in vogue and that is the best scheme gong in the market for retired persons.

The Senior Citizen Savings Scheme (SCSS) is often referred to as the best alternative for the elderly to invest their money. Is this justified? Here's a detailed look at all the features of the Senior Citizen Savings Scheme, and an analysis of whether you should invest in it or not.
The investment can be made only by people of 60 years of age or above.
People who have retired on superannuation or under a voluntary retirement scheme can also invest if they are at least 55 years old.
The account can be opened as a single account, or can be opened in joint names. The joint account holder can only be the spouse.
There is no age limit applicable for the joint account holder (spouse).
In case of the death of the primary account holder, the spouse can continue the account – this is subject to the condition that his / her total investment in SCSS should not exceed Rs. 15 Lakhs.
People retiring from defense services are eligible to invest in the scheme irrespective of the age limit, but there are some additional conditions applicable

The Senior Citizen Savings Scheme account can be opened only by individuals. It can not be opened by Non-Resident Indians (NRI), Persons of Indian Origin (PIO) and Hindu Undivided Families (HUF).

For people between 55 and 60 years of age, the amount invested in SCSS has to come from their retirement benefits.
For persons over the age of 60 years, there is no restriction on the source of funds invested. The Senior Citizen's Savings Scheme has a maturity of 5 years, which is extendable by 3 years.
The rate of interest offered on the investment is 9% per annum and account can be opened in post office or in nationalised. perhaps only icici is the only private sector bank that handles SCSS.
There is Section 80C income tax benefit on the investment made in SCSS, but there is no income tax benefit on the interest earned from it.
The investment made in the Senior Citizen Savings Scheme on or after 1st April, 2008 is deductible from your income under section 80C of the Income Tax Act. The interest earned on the deposit is fully taxable.


The income tax applicable is deducted at source. If your income is not taxable, you can provide form 15H or 15G so that no tax is deducted at source.
The tax is deducted at source only if the total interest in a year is over Rs. 5,000.
The account can be opened as a single account, or can be opened in joint names. The joint account holder can only be the spouse.
There is no age limit applicable for the joint account holder (spouse).
In case of the death of the primary account holder, the spouse can continue the account – this is subject to the condition that his / her total investment in SCSS should not exceed Rs. 15 Lakhs.



The interest is paid out every 3 months. This means that SCSS can provide a steady, periodic income. There is no provision for cumulative income.The SCSS is backed by the Government of India, and thus, carries a sovereign guarantee for principal and interest payments. Therefore, it is among the safest investment avenues available in India.

One reader has asked if he wants to invest more than fifteen lakh where should he invest? MY RECOMMENDATIONS WOULD BE ,without taking any risk, Monthly income plan with Bonus from post office. BUT one must remember that if you look for absolute safety a time would come when your money value would deplete and it may not possible sometime to buy even potato. So invest in equity also to take care of inflation.




Since the scheme is absolutely safe, and provides periodic payment of interest, retirees and senior citizens can invest a portion of their retirement corpus in the Senior Citizen Savings Scheme.


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