Sukanya Samriddhi scheme (SSY) vs Employees Provident Fund (EPF): Which can produce larger corpus on Rs 1.1 lakh annual investment?

Sukanya Samriddhi Yojana (SSY)

• SSY is a government-backed savings scheme aimed at the financial security of a girl child.
• The scheme offers an 8.2% annual interest rate (as of January 1, 2024).

Key Features of SSY

• Eligibility: Can be opened by a guardian for a girl child below 10 years.
• Deposit Limits: Minimum Rs 250 and maximum Rs 1,50,000 annually.
• Tenure: Deposit allowed for 15 years; account matures after 21 years.

Tax Benefits of SSY

• Investments qualify for Section 80C deductions.
• Interest earned is tax-free, maximizing returns.

Withdrawal and Premature Closure in SSY

• Partial withdrawal allowed after the girl turns 18 or completes Class 10.
• Premature closure permitted in specific cases like the account holder's death.

SSY Returns on Rs 1,10,000 Annual Investment

• Total Investment: Rs 16,50,000 (over 15 years).
• Total Interest: Rs 34,30,224.
• Maturity Value: Rs 50,80,224.

Overview of Employees’ Provident Fund (EPF)

• EPF is a retirement savings scheme managed by EPFO under the Government of India.
• Both employee and employer contribute 12% of the basic salary.

Interest and Tax Benefits of EPF

• Interest Rate: 8.15% annually.
• Tax Benefits: Accrued interest is tax-free, offering a lump sum upon retirement.

Accessibility of EPF Services

Individuals can manage EPF accounts through a user-friendly online portal, ensuring efficient service access.

EPF Returns on Rs 1,10,000 Annual Investment

• Total Investment: Rs 16,50,000 (over 15 years).
• Maturity Value: Rs 32,96,741.71.

Which one provides more returns?

SSY provides a maturity value of Rs 50,80,224, significantly more than EPF's Rs 32,96,741.