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Comparison between different investment plans

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Introduction-

Comparison between different investment plans: Sukanya Samriddhi, PPF, NSC, KVP and Tax saver FDRs- I have already explained best investment plans which can be used smartly to get good returns. Now I am comparing SSY, PPF, NSC, KVP and Tax saver FDRs, so that you can manipulate which plan suits best to your requirements. The Comparison are as under-


Sukanya Samriddhi Yojana is a good option if you have a daughter below the age of 10 years. The Account can be opened with a minimum amount of Rs. 1,000/- per month to be deposited for a period of 14 years. Maximum of Rs. 1,50,000 can be deposited during the financial year. Premature withdrawal facility is also allowed after the girl child turns 18. The account can be closed only after the child turns 21. Now the interest rate has been increased to 8.50% w.e.f 01.10.2018, earlier it was 8.10% from 01.04.18 to 30.09.2018. The interest earned thereon is compounded. This scheme is covered under triple EEE (Exempt, Exempt, Exempt) category, means that the amount which you have deposited is covered under section 80C, the interest earned thereon is tax free and even the maturity amount is also tax free.

 

Public Provident Fund is one of the best, trustworthy and popular investment schemes. The complete amount can be withdrawn after completion of lock-in period of 15 years. The same account can be extended for further 5 years. You can make partial withdrawal after completion of 6 years under any specific reasons like medical treatment, daughter’s marriage etc. After completion of 3 years, you can also avail loan facility. The minimum amount to be deposited annually is Rs. 500 and maximum can be up to Rs.1,50,000. Now the interest rate has been increased to 8.00% w.e.f 01.10.2018, earlier it was 7.60% from 01.04.18 to 30.09.2018. The interest earned thereon is compounded. This scheme also covered under triple EEE (Exempt, Exempt, Exempt) category, means that the amount which you have deposited is covered under section 80C, the interest earned thereon is tax free and even the maturity amount is also tax free.

 

National Savings Certificate is a fixed guaranteed income investment scheme. The Maturity period is of 5 years. No premature payment can be received exceptionally on the death of investor. Even you can invest the minimum amount of Rs. 100 and there is no maximum limit to invest in NSC. The maximum amount for deduction under section 80C is allowable up to Rs. 1,50,000. The interest accrued on NSCs every year is also eligible within tax deduction limit of Rs. 1,50,.000. Now the interest rate has been increased to 8.00% w.e.f 01.10.2018, earlier it was 7.60% from 01.04.18 to 30.09.2018. The interest received on NSC is fully taxable.

 

Kisan Vikas Patra is also fixed guaranteed income investment scheme. The Maturity period is 112 months w.e.f. 01.10.2018, earlier it was 118 months from 01.04.2018 to 30.09.2018. Premature withdrawal is allowed only after completion of 30 months. You can invest the minimum amount of Rs. 1000 and there is no maximum limit to invest in KVP. Now the interest rate has been increased to 7.70% w.e.f 01.10.2018, earlier it was 7.30% from 01.04.18 to 30.09.2018. The interest earned thereon is fully taxable. The investment in KVP is not eligible for tax deduction limit.

 

Tax Saver Fixed Deposits is a type of fixed deposit, by investing in which, you can get tax deduction under section 80C of Income Tax up to maximum of Rs. 1, 50,000. Lock-in period of tax saver fixed deposits is 5 years. Premature withdrawal facility is not available. Interest rate varies from bank to bank. The average interest rate is 6% to 7% per annum. The interest rate is less as compared to all other small saving schemes. Interest received thereon is also fully taxable


Summarised Comparison Chart-
Schemes Sukanya Samriddhi Yojna Public Provident Fund National Saving Certificate Kisan Vikas Patra Tax Saving FDR
Interest Rate 8.50% 8.00% 8.00% 7.70% 6% to 7%
Tax Benefit on Investment Yes Yes Yes No Yes
Tax Benefit on Return Tax Free Tax Free Taxable Taxable Taxable
Minimum Investment Amount  1,000 500 100 1,000 Above 1,000
Maximum Investment Amount (Yearly) 1,50,000 1,50,000 No Limit No Limit No Limit
Tenure 21 Years 15 Years 5 Years 118 Months 5 Years
Prematue Withdrawal  Girl turn 18 years Partial withdrawal after completion of 6 years Only on exceptional cases After completion of 30 months Not Allowed

The above interest rates are effective from 01.10.2018

 
WHICH ONE IS BEST
  1. Sukanya Samridhi Yojna is one of the best plans for investment for a girl child. This scheme is covered under triple EEE (Exempt, Exempt, Exempt).
  2. Public Provident Fund is a golden plan for long term investment. This scheme is also covered under triple EEE (Exempt, Exempt, Exempt). It is like a plant which you are watering today and getting fruits later on.
  3. National Savings Certificate is a good plan for short term investments only. Long time savings will not yield so much fruitful because amount of interest received on NSC- is fully taxable. While the interest accrued on NSCs every year is also eligible within tax deduction limit, thus making good option for short term investments.

Please keep in mind that mutual funds with small investments as above stated are the best option to get maximum returns in long term.

But don’t forget the success mantra i.e. Don’t’ depend on a single plan for your success.



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