SSY or SIP: Which Investment is Right for Your Girl Child”s Financial Goals?
SSY or SIP, where should you invest? Can’t figure it out? Then this article is for you. With the birth of a child, parents also start worrying about their future. For this reason, people start investing in all the schemes with his birth so that he can collect a good amount till he grows up.
If you are the father of a daughter, then the name of Sukanya Samriddhi Yojana will definitely be in your mind because this scheme has been started by the government, especially for daughters.
SSY
This scheme is getting interest at the rate of 8.2 percent. If your daughter’s age is less than 10 years, then you can invest in this scheme in her name. At the same time, SIP is also considered a very good option in terms of making fast money.
Through this, you can invest in a mutual fund in the name of your daughter. Although you should know that SSY is a guaranteed return scheme, Mutual Fund is a market-linked scheme in which returns are not guaranteed.
But experts consider this scheme to be very good in terms of making money in the long term because its average returns are also considered better than all the schemes.
Where is it better for daughter to invest either SIP or SSY? If you are confused by thinking this, then understand about the returns of both schemes here; this will make it much easier for you to decide.
SSY returns on Rs 5,000 monthly deposit
SSY is invested for 15 years, after which the amount is kept locked. The scheme matures after 21 years, i.e., you get the maturity amount after 21 years.
In such a situation, if you invest Rs 5000 every month in Sukanya Samriddhi Yojana, then 60,000 in a year and 9,00,000 rupees in 15 years will be invested.
Calculated according to the current interest rate, according to the 8.2 percent interest rate, the total interest will be Rs 18,71,031 in 21 years, and after 21 years the maturity amount will be Rs 27,71,031.
How much return from a monthly SIP of Rs 5000
On the other hand, if you invest 5000 rupees every month in mutual funds through SIP, then in 15 years you will invest 9,00,000 rupees here too. The average return on SIP is considered to be 12 percent.
Sometimes you get more than this. In such a situation, if calculated according to 12 percent, then in 15 years, an investment of 9 lakh will get an interest of Rs 16,22,880.
If you withdraw this amount within 15 years, then you will get Rs 25,22,880. This amount is close to the returns received on Sukanya Samriddhi in 21 years.
On the other hand, if you continue this investment for 1 year, i.e., invest 16 years instead of 15, then at the rate of 12%, you will get Rs 29,06,891, which is much higher than the returns of the Sukanya Samriddhi Yojana.
If you continue this investment for 21 consecutive years, then you can get up to Rs 56,93,371 through SIP at a rate of 12% returns, while your investment will be a total of Rs 12,60,000. That is, you will get Rs 44,33,371 as interest only on investment.
SSY vs. SIP
Now let’s talk about the advantages. One advantage of SSY is that you can take tax benefits in three ways. This scheme falls under the EEE category.
In this, the amount deposited every year is not taxed; apart from this, the interest received every year is not taxed, and the entire amount received at the time of maturity is also tax-free, i.e., tax is saved in investment, interest/return, and maturity. But in SIP, you do not get tax exemption.
Apart from this, the returns in Sukanya Samriddhi are certain, but SIP does not have guaranteed returns because it is market-linked. However, experts consider it a better investment option in the long term.
SIP has the advantage of rupee cost averaging in the long term; in such a situation, the risk is greatly reduced. The average return in SIP is considered to be 12 percent. This is much better than Sukanya. Many times you get more interest than this.
If your daughter is less than 10 years old, then only you can invest in the Sukanya Samriddhi Yojana. But age has nothing to do with SIP; you can also invest in the name of the child.
Of course, you have to invest in SIP for 15 years, but after that, your money remains locked for many years. In such a situation, you cannot use it. SIP is flexible. You can start it anytime and stop it anytime.
SSY can be deposited up to a maximum of Rs 1.5 lakh annually, but there is no such limit in SIP. You can put any amount of money in it.