Senior Citizen Savings Scheme Calculation 2023: Senior Citizens now have the opportunity to deposit more amount in the Senior Citizen Savings Scheme (SCSS). Till now, the maximum deposit limit under SCSS small savings scheme was Rs 15 lakh per person. However, Finance Minister Nirmala Sitharaman proposed in her Budget 2023 speech that the deposit limit under this savings scheme for senior citizens will be increased to Rs 30 lakh.
“The maximum deposit limit for Senior Citizen Savings Scheme will be enhanced from Rs 15 lakh to Rs 30 lakh,” the Finance Minister said in the Budget Speech.
Why SCSS?
SCSS provides a worry-free investment opportunity to senior citizens and decent returns. The scheme is backed by the Government, hence there is a guarantee of the safety of the deposited amount. The current interest rate for SCSS is 8%. While the SCSS interest rate is revised quarterly by the Finance Ministry, the rates have historically remained high and better than many fixed deposit schemes offered by banks and the post office.
How to calculate SCSS return
You can easily calculate the SCSS interest income using a simple calculator. Or, you can make a calculator yourself on Exel. As the scheme provides simple interest, it is extremely easy to calculate the total return on investment in the SCSS account.
Also Read: Who will get money if SCSS and other small savings scheme accountholder dies without nomination?
What the SCSS calculator says
The scheme comes with a quarterly withdrawal facility to help senior citizens with regular cash flow. The deposits under the SCSS scheme earn interest for 5 years only. However, there is an option to extend the account by another 3 years after the completion of the 5-year maturity period.
As the deposit limit has now been raised to Rs 30 lakh per account, senior citizens now get higher quarterly income. Following is a calculation of how much interest income senior citizens can get annually and in 5 years by depositing amounts ranging from Rs 5 lakh to Rs 30 lakh. (Note: The interest rate assumed for the below calculation is 8%)
| Amount Rs | Monthly Interest (Rs)* | Quarterly Interest (Rs)* | Annual Interest (Rs) | 5-Year Interest (Rs) |
| 100000 | 665 | 2000 | 8000 | 40000 |
| 300000 | 2000 | 6000 | 24000 | 120000 |
| 500000 | 3333 | 10000 | 40000 | 200000 |
| 1000000 | 6667 | 20000 | 80000 | 400000 |
| 1500000 | 10000 | 30000 | 120000 | 600000 |
| 2000000 | 13333 | 40000 | 160000 | 800000 |
| 2500000 | 16667 | 50000 | 200000 | 1000000 |
| 3000000 | 20000 | 60000 | 240000 | 1200000 |
The calculation shows that the quarterly interest income from SCSS account by depositing Rs 30 lakh will be Rs 60,000 if the interest rate remains at 8%. This means, the monthly income by depositing Rs 30 lakh will be Rs 20,000.
How much you can deposit in the SCSS account
The minimum deposit allowed in the SCSS scheme is Rs 1000 and thereafter in multiples of Rs 1000). The maximum deposit limit as announced in Budget 2023 is Rs 30 lakh. A formal notification for this change in the SCSS account deposit limit is expected to be out soon.
SCSS Deposit Limit Hike Impact
Experts say that the increase in the SCSS deposit limit will help senior citizens in providing decent returns and ensure the safety of their deposit and their retirement corpus.
“The increase in the maximum investment limit in the scheme from Rs 15 lakh to Rs 30 lakh will directly benefit the middle-class elder,” says Rohit Prasad, CEO of HelpAge India.
“Increase in Small Savings investment limits for Senior Citizens is a great initiative to help protect retirement corpus and income for senior citizens,” says Abhishek Dev of Epsilon Money Mart.
