The Sukanya Samriddhi Yojana (SSY), launched under the Beti Bachao, Beti Padhao initiative in January 2015, is one of India's most popular government-backed savings schemes for daughters. The scheme is designed to provide parents with an excellent way to save for their daughter's higher education and marriage, ensuring a secure financial future. By making regular contributions, parents can accumulate a significant amount by the time their daughter reaches adulthood.

The SSY scheme offers an attractive interest rate of 8.2%, which is typically higher than the rates offered by most banks on fixed deposits (FDs). The interest earned on this account is also tax-free, making it a highly advantageous option for long-term savings. Additionally, the contributions made towards this account qualify for tax deductions under Section 80C of the Income Tax Act, allowing parents to claim up to Rs 1.5 lakh in tax savings annually.

Who Can Open an SSY Account?

To open an SSY account, the following conditions apply:

• Eligibility: Parents or legal guardians can open an SSY account on behalf of a girl child who is 10 years old or younger. Only one account can be opened per daughter.

• Required Documents: A birth certificate, ID proof, and address proof are required to open the account.

• Where to Open: The account can be opened at the nearest post office or bank branch.

How Does the Scheme Work?

The SSY account matures 15 years after opening, at which point the funds are fully accessible. Partial withdrawals can be made for higher education once the girl turns 18. If the daughter gets married before the account matures, the account must be closed at the time of marriage.

The full maturity benefits are available when the girl turns 21. By that time, the savings will have grown significantly, thanks to the high interest rate and the power of compounding.

How to Reach Rs 71 Lakh?

By contributing the maximum allowed amount of Rs 1.5 lakh annually for 15 years, the final maturity amount will grow to approximately Rs 71.82 lakh. Here's how it works:

• Rs 22.5 lakh is your initial investment (Rs 1.5 lakh annually for 15 years).

• The remaining Rs 49.32 lakh comes from the interest earned at the rate of 8.2%, which is compounded annually.

The best part is that this entire amount is tax-free when withdrawn after maturity, offering a solid return on your investment.

Who Can Manage the Account?

As of October 1, 2024, only parents or legal guardians will be able to manage the SSY account. If the account was opened by someone other than the legal guardian or parents, it must be transferred to the rightful guardian, or it will be closed. This ensures that the savings are being managed responsibly for the benefit of the child.

The Sukanya Samriddhi Yojana is a great way for parents to ensure financial security for their daughters, providing a high interest rate, tax benefits, and a secure, government-backed investment option. By contributing regularly to this scheme, parents can accumulate a substantial amount by the time their daughter turns 21, allowing her to pursue higher education, start a career, or get married with financial stability.