Want to spend a luxurious life after retirement? Try these saving schemes, say experts

Being rich doesn't mean you need not to earn. Especially, if an individual is a retired person. It's okay that a retired person can't match with the physical ability of the working professional but they have garnered some experience that may help them continue to earn via smart investments. So, investment after retirement is a good option for retired professionals to continue their earnings. As they are not in that condition to take the risk, there are several options that help them earn with risk-free investment options like Senior Citizens Savings Scheme (SCSS), Bank Bond, Government Bond, etc.

Highlighting the returns an investor who has retired can expect in Senior Citizens Savings Scheme and in bank bonds, Kartik Jhaveri, Director — Wealth Management at Transcend Consultants said, "SCSS is 100 per cent risk-free and an investor can get an assured 8.6 per cent return in this investment scheme." Jhaveri said that interest paid under the scheme is paid quarterly and its rate of interest is also decided by the government on a quarterly basis. But, for such investors, bank bonds are a better option as it gives around 9 per cent returns instead of 8.6 per cent return being given in SCSS. Like SCSS, bank bonds are also risk-free as the government of India is a guarantor for the money being taken by banks for the bonds issued." He said that unlike government bonds, bank bonds are available all the time but for that, one needs a Demat account that is necessary for buying a bank bond through a bond broker. Elaborating upon the age factor involved in SCSS Scheme, he said that in SCSS investment, one has to be at least 55 years of age while opening an SCSS account but in bank bond, there is no such age bar.

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Speaking on the Senior Citizens Savings Scheme, Balwant Jain, a Mumbai-based tax and investment expert said, "If an investor has retired on superannuation or have taken voluntary retirement, he or she can also invest under this scheme provided they have completed 55 years of age at the time of opening the account. But, this age limit does not get applied to the Ex-servicemen. In either of the case, the account under SCSS has to be opened within one month from the receipt of retirement money with proof of disbursal. Only the money received as retirement benefits under the terms of such retirement can be invested under this scheme." Jain went on to add that the initial tenure of the SCSS account is five years but it can be extended for once for another period of three years. Deposits made under SCSS can be withdrawn after completion of one year, but that too with a penalty. A penalty of 1.50 per cent of the deposit amount is levied if you close the account after one year but before completion of two years. The amount of penalty comes down to 1 per cent for accounts closed after two years. The deposits under extended account can be withdrawn any time after one year without any penalty.

Pointing out the investment limit in the SCSS scheme Balwant Jain said, "One can deposit only up to Rs 15 lakh under this scheme either by opening a single or a joint account. Since determining the eligibility to open the account under this scheme the age of the first holder is only considered, the spouse can be added as joint holder even if he/she has not completed the required 55 years of age."