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Senior citizen saving scheme – all that you want to know.

Financial planning is so important to secure your future. Oftentimes senior citizens get so lost in their life and kids that they forget about financial planning. But at All About Seniors – the world’s first lifestyle portal for senior citizens, we care for you. That’s why through this blog we want to make you aware about – what is senior citizens’ saving scheme and post office senior citizen saving scheme. 

What is senior citizens’ saving scheme? 

Let’s start by understanding the basics. Senior citizens’ saving scheme is popularly known as SCSS. A lot of people also know this as post office senior citizen saving scheme. 

Senior citizens’ saving scheme can be availed by any individual above the age of 60 years. It is a really effective saving option for those who are looking for long-term solutions. The post office senior citizen scheme was launched with the aim that senior citizens get regular income and various other tax benefits. It is allowed at post offices and certified banks across the country. 

  • Tenure – 5 years 
  • Senior citizen saving scheme interest rate – 7.4% p.a.
  • Investment amount – maximum amount of 15 lakh can be deposited
  • Premature withdrawal – allowed 

The depositor in post office senior citizen saving scheme can claim tax benefits under section 80C on the deposited amount. It is really easy to transfer the account from one post office to another.

Saving for the future is something we should all plan. When you invest in Govt. schemes, you know your money is in safe hands. This is a big assurance, especially for senior citizens. You can start investing in the scheme as soon as you turn 60 years. If you have taken VRS, then you can start at the age of 55 years also. 

Senior citizen saving scheme interest rate 

When you start an investment or a saving scheme, one of the first questions that come to mind is – what is the interest rate? Senior citizen saving scheme interest rate has been reduced from 8.6% to 7.4% per annum (from October 01 to December 31, 2021). The returns of the SCSS are high when compared to savings and Fixed Deposit (FD).

Another important question that people ask about senior citizens’ saving scheme is – whether TDS is applicable to the scheme or not? The answer is yes. If the interest exceeds Rs. 10,000/- per annum, TDS is applicable. 

Senior citizens’ saving scheme features 

Some of the main features of senior citizens’ saving scheme are discussed below –

  • Scheme maturity 

The maturity of senior citizens’ saving scheme is 5 years. However, the maturity can be extended by 3 years by simply submitting an application within one year of maturity of the account. You can also close the account without any additional charges after the account has expired.

  • Premature withdrawal 

Premature withdrawal is allowed after one year of opening an account in senior citizens’ saving scheme. You need to keep in mind that a 1.5% charge and a 1% charge of the total amount deposited will be charged in case of premature withdrawals after 1 year and 2 years, respectively for the post office senior citizens’ saving scheme 

  • Nominations 

There is a facility for adding nominee while opening a senior citizens’ saving scheme account. Nominations can be filed by filling an application in Form C. 

  • Minimum and maximum amount 

Only a single deposit is allowed in the account. It can be in the multiples of Rs. 1000 and the maximum amount that can be deposited is Rs. 15 lakh. Deposit amount of less than 1 lakh can be made in cash, and amount more than 1 lakh needs to be done through cheque. 

  • Number of accounts 

Individuals are allowed to operate more than one account for post office senior citizen scheme by themselves. There is also a provision of opening a joint account with their spouse

  • Transfer to account 

You can easily transfer an SCSS account from post office to your bank account and vice versa.

Documents checklist 

In order to open a SCSS or a post office saving account, you need the following documents – 

  • 2 passport sized photographs 
  • Form A – completely filled and submitted 
  • Identity proof – passport or PAN card
  • Proof of address- Aadhar Card or telephone bill 
  • Age proof – voter ID, PAN Card, Passport, or senior citizen card

Do keep in mind that all the documents need to be self attested when opening a senior citizens’ saving scheme account. 

How to open an account for post office senior citizen scheme? 

The process of opening an account is fairly simple. You can visit your nearest post office or bank branch. Submit the application form (properly filled) along with your KYC documents. You need to also provide a cheque or cash for the amount that you want to deposit and can even add nominees in the account.

The post office senior citizens saving scheme interest rates are determined by the Central Govt. Eligibility. Individuals above the age of 60 years can open an account in senior citizens’ saving scheme.  Individuals who have attained the age of 55 years old, but are below the age of 60 years old and have retired on superannuation are eligible to open an SCSS account.

Hope all this information helped you understand the post office senior citizen scheme in detail. If you have any more questions on what is senior citizens’ saving scheme, then you can comment down below and we’ll get back to you! 

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