Sukanya Samriddhi Yojana
Sukanya Samriddhi Yojana (SSY) is a Government of India small-savings scheme aimed at the girl child, launched in 2015 under the 'Beti Bachao, Beti Padhao' initiative. It allows parents/guardians to open a savings account in the name of a daughter aged 0–10 years, with attractive interest rates and full tax exemption under Section 80C.
Understanding Sukanya Samriddhi Yojana
SSY accounts can be opened at any post office or authorised bank branch (SBI, HDFC, ICICI, etc.). The minimum annual deposit is ₹250; maximum ₹1.5 lakh — combined across all SSY accounts the family holds. Deposits must be made for 15 years from account opening; the account matures 21 years from opening or when the girl marries (whichever is earlier, with marriage allowed only after age 18).
Partial withdrawal of up to 50% of the previous year's balance is allowed when the girl turns 18 or completes 10th standard, for higher education or marriage expenses. Premature closure (before 21 years) is allowed only for compelling reasons — death of account holder, life-threatening illness — with reduced interest.
Why it matters
For parents of a daughter, SSY is one of the highest-yielding tax-free instruments available — beating PPF (7.1%) and FDs (6.5–7.5%) handily on both pre-tax and post-tax basis. The 21-year horizon aligns perfectly with funding higher education or marriage, making SSY a near-perfect product for goal-based saving for the girl child.
Example
Parents open SSY for their daughter at age 5 with ₹1.5 lakh annual deposit for 15 years. Total contribution: ₹22.5 lakh. At 8.2% compounded annually over 21 years (15 contribution years + 6 holding years), maturity value: approximately ₹73 lakh — entirely tax-free. Plus ₹6.75 lakh of cumulative tax savings from 80C over 15 years (at 30% slab) brings effective return well over 10%.
Parents open SSY for their daughter at age 5 with ₹1.5 lakh annual deposit for 15 years. Total contribution: ₹22.5 lakh. At 8.2% compounded annually over 21 years (15 contribution years + 6 holding years), maturity value: approximately ₹73 lakh — entirely tax-free. Plus ₹6.75 lakh of cumulative tax savings from 80C over 15 years (at 30% slab) brings effective return well over 10%.