NPS Vatsalya vs Sukanya Samriddhi Calculator: Which will help generate higher corpus on Rs 10,000 monthly contribution for 15 years?

NPS Vatsalya versus Sukanya Samriddhi Yojana (SSY): After the launch of the novel NPS Vatsalya scheme which aims at securing child's future financially, you as a parent may be wondering whether NPS Vatsalya or SSY  will fetch a better return if you have to choose between the two.

Importantly, while the two schemes are not comparable with the SSY being sovereign-backed and the other a market-linked instrument, it will help us arrive at some estimates.

Siddharth Alok,AVP Investments, Multi Ark Wealth-Epsilon Money said, "it is not an apple-to-apple comparison. For starters, SSY is available only for girl child. Secondly, it is purely a debt product, currently offering ~8.2% per annum. This interest rate is set by the government and may change. NPS Vatsalya is a market linked product with average return ranging 10 – 12%. 
Just for assumptions, let’s say INR 10,000 is invested every year for the next 10 years (i.e., till the child is 18 years) in both these solutions, NPS will become ~INR 1.86 lacs while SSY will give a total of ~INR 1.58 lacs, assuming NPS grows at 11% CAGR and the interest rate for SSY continues to be 8.2%, added Alok.

Calculating the returns from NPS Vatsalya versus Sukanya Samriddhi Yojana
Here we are taking the tenure of investment as 15 years and the investment amount as Rs 10,000 per month.

So, in such a scenario, considering 12 per cent return per annum, with the NPS Vatsalya scheme an investor after a 15 year tenure will put in a total investment of Rs 18 lakh and on it his return will be Rs 32,45,660, taking the total corpus of Rs 50,45,760.

Nonetheless, in the case of SSY, while the corpus in 15 years would grow to Rs 34,56,412, the same would scale up even more at maturity after 21 years as the centre on this scheme offers the interest for 6 years without any additonal investment.

Also note  in SSY, the account matures at the end of 21 years or when the girl child attains the age of 18, whichever is earlier. 

In NPS Vatsalya, once the child is 18 years old it automatically becomes like a normal NPS account. Thus, it helps solid  retirement planning as you can invest for almost 60 years