No worries about money in old age! This government scheme offers ₹17,000 per month; here are the details.

SCSS Scheme: If you are looking for a regular income after retirement, the Senior Citizen Savings Scheme (SCSS) could be an excellent option for you. Investments in this government scheme earn a fixed rate of interest, and the capital remains safe.

SCSS Scheme: After retirement, a regular income is often the biggest concern for people. Everyone desires financial security for their old age. If you wish to receive a fixed monthly amount after retiring, there is good news for you. The government runs several savings schemes for senior citizens, but the Senior Citizen Savings Scheme (SCSS) is one of the most popular among them.

This scheme is specifically designed to meet the need for regular income post-retirement. Operated through the Post Office, this scheme is unaffected by stock market fluctuations, and investors benefit from a fixed interest rate.

Couples can make a substantial joint investment.

An important point to note is that an individual can invest up to a maximum of ₹30 lakh in the SCSS. Consequently, a couple can jointly invest a total of up to ₹60 lakh. If an investor deposits ₹25 lakh in this scheme, they will receive interest payments in their account every three months.

How much interest will be earned on ₹25 lakh?

Based on the current annual interest rate of 8.2%, an investment of ₹25 lakh will yield approximately ₹2.05 lakh in interest over a year. This interest is paid on a quarterly basis.

Annual interest: ₹2.05 lakh
Interest every three months: ₹51,250
Average monthly income: Approximately ₹17,083

What will be the total benefit over 5 years?

If an investor deposits ₹25 lakh in this scheme for a period of 5 years, they will receive a total of ₹10.25 lakh as interest. Upon maturity, the initial investment amount of ₹25 lakh will also be refunded. Thus, the total amount could reach ₹35.25 lakh after five years. Most importantly, individuals opting for the 'Old Tax Regime' can avail a tax deduction of up to ₹1.5 lakh under Section 80C of the Income Tax Act on investments made in the SCSS.

Know the rules regarding TDS

TDS may be deducted if the total interest earned from the SCSS and other savings schemes at the same bank or post office exceeds ₹50,000 in a financial year. TDS will be deducted at a rate of 10% if a PAN card is provided; if a PAN card is not provided, the deduction will be at a rate of 20%.