Sukanya Samriddhi Account interest rate: How you can create Rs 50 lakh corpus for your girl child

Sukanya Samriddhi Account (SSA) is a government-backed small savings scheme, offering the joint highest interest rate among all such schemes. SSA is focused on creating a corpus for education and marriage of a girl child. SSA was launched as a part of the 'Beti Bachao Beti Padhao' campaign in 2015.

The scheme allows parents or guardians to deposit up to Rs 1.5 lakh per financial year to create a sizable corpus for a girl child.

If one consistently invests Rs 1.5 lakh a financial year in an SSA account, they may generate a corpus of over Rs 71 lakh for their girl child, assuming that the interest rate remains unchanged throughout the tenure of the deposit.

What is the current Sukanya Samriddhi Account interest rate?

Sukanya Samriddhi Account currently offers an interest rate of 8.2% per annum, compounded annually. The interest rate is reviewed by the Finance Ministry every quarter. The current interest rate is applicable from January 1, 2024.

SSA details

The minimum annual investment required in a financial year is just Rs 250, while the maximum permitted investment is Rs 1.5 lakh per financial year. Deposits may be made till the completion of a period of 15 years from the date of the opening of the SSA account.

How can you build an SSA corpus of around Rs 50 lakh?

If you invest Rs 1.05 lakh every financial year for 15 years and considering the interest rate remains at 8.2% per annum throughout the tenure, the maturity amount at the end of 21 years will be over Rs 50 lakh. While investment will be for 15 years, the account holder will get compound interest for 21 years.

Here is how
Annual investment: Rs 1,05,000
Investment period: 15 years
Total investment: Rs 15.75 lakh
Interest rate: 8.2% per annum
Maturity period: 21 years
Estimated maturity value: Around Rs 50.27 lakh
Interest earned: Rs 34.52 lakh (approximately)

Considering that the interest rate does not change over the years and stays at 8.2%.

The interest will be calculated for the calendar month on the lowest balance in the account between the close of the fifth day and the end of the month.

How is SSA interest calculated?

The interest will be calculated for the calendar month on the lowest balance in the account between the close of the fifth day and the end of the month. Interest shall be credited to the account at the end of each financial year.

How does the SSA investment pattern work?

An SSA account holder invests for 15 years consecutively and receives compound interest on the deposits. For the next 6 years, they don’t invest any amount, but they keep getting compound interest on the corpus. After 21 years, they can withdraw the corpus.

Tax benefits under SSA

Sukanya Samriddhi Account has an EEE (Exempt-Exempt-Exempt) status. It means that deposits provide tax benefits under Section 80C of the Income Tax Act, 1961, subject to a cap of Rs 1.5 lakh in a financial year. Both the interest earned and the maturity amount are also tax-free.

SSA calculator used: HDFC Bank