Senior Citizens Savings Scheme is designed to provide regular income for adults, has undergone recent government revisions aimed at offering enhanced benefits to retired individuals and their spouses. We will delve into these modifications in this blogpost.
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Deadline change
Retired employees aged between 55-60 years can now invest their retirement benefits in this scheme within three months of receiving them, as opposed to the previous one-month deadline.
Widows or widowers of government employees
Widows or widowers of government employees who passed away while in service after the age of 50 can invest their received financial compensation in this scheme. This applies universally to central and state government employees.
Definition of retirement benefits has broadened
The definition of retirement benefits has broadened, encompassing various payments upon termination of employment, such as provident fund, gratuity, pensions, remaining leave payments, savings from insurance schemes, and more. All these funds can now be invested in the Senior Citizens Savings Scheme (SCSS).
New regulations on early withdrawals
New regulations regarding early withdrawals have been implemented. Withdrawing within a year of depositing funds in SCSS incurs a one percent fee on the withdrawn amount, differing from the previous policy of only deducting the interest while returning the deposit.
Tenure extension limit for Senior Citizens Savings Scheme account
The government has extended the tenure extension limit for SCSS account holders to three years, with no maximum cap on extensions. However, an application needs to be submitted each time. Previously, this extension opportunity was available only once, with the interest rate at the maturity date being applicable.
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Deposits under Senior Citizens Savings Scheme
Only the initial deposit amount made at the time of account opening will be returned after the scheme’s expiry. No additional deposits are permitted during the scheme’s tenure or its extension. To contribute more funds, a new account must be opened within the specified maximum limit.
Under the current guidelines, deposits up to Rs. 30 lakh are accepted in this scheme, and in the event of the account holder’s demise, the spouse can continue the scheme. Presently, the scheme offers an annual interest rate of 8.2 percent.
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