Senior citizen's savings scheme is a great way to invest your hard earned money without worrying about the ups and downs of the economy. The scheme is open for the people who have attained the age of 60 years or more. Anyone who is 55 years old or more but less than 60 years of age can also reap the benefits of this scheme if they are retired under a superannuation or otherwise.

The scheme has been active and serving the people since 2004. The scheme is a government of India controlled savings scheme.

Senior citizen's savings scheme

Let us elaborate more about the senior citizen's scheme below with simple to understand questions and answers.

Where can I open an account under the senior citizen's savings scheme?

The account can be opened by any eligible person in;
A post office which is authorized to do saving bank work.
An authorized bank which accepts subscription under public provident fund scheme.
The person can approach such post office or bank, fills the application form (Form A) and deposit pay-in-slip (Form D) along with the age proof to open the account under the scheme.

Can a person who has retired under a voluntary or special voluntary scheme open an account under this scheme?

Yes, such a person is eligible to open an account and reap all the benefits of the scheme. However, there are some conditions which need to be fulfilled and they are:
The person opens the account within 3 months of his/her retirement.
He/she is over 55 years of age but not attained 60 years of age.
He/she has to submit a certificate from the employer stating the fact of the retirement. The certificate should also have the details about retirement benefits received and the period of employment.
However, the people retired from Defence services (excluding people retired from Civil Defence) are exempted from such age-related restrictions. But they must fulfill all other eligibility requirements.

Can I open an account jointly with my spouse?

Yes, a person is allowed to open the account individually or with his/her spouse.

How many deposits are allowed in the scheme?

Only one deposit is allowed in the account in multiples of 1000 rupees but the total deposit must not exceed fifteen lakh rupees. If you are retired under VRS or SVRS, the allowed deposit amount is either fifteen lakh rupees or retirement benefits received or which one is lower.

How can we deposit in the account?

You can deposit in your account:
In cash: If the total deposit is less than or equal to 1 lakh rupees.
By cheque or demand draft: If the deposit amount is more than 1 lakh rupees.
You can also deposit by an online transfer if such facilities are available at the place where you have your account.

Is the nomination facility available in the scheme?

Yes, you can nominate one or more people in the scheme during the opening of the account.

You can also nominate someone by filling and submitting the application in the Form-C to your deposit office after the opening of the account but before the closure of the account.

Can we transfer the account from one deposit office to another?

Yes, you can transfer the account from one deposit office to another deposit office by filling up and submitting Form G along with your passbook to your deposit office.

Is there any fee for transferring the account from one deposit office to another deposit office?

If the deposit is one lakh rupees or above, a transfer fee of rupees five for every one lakh rupees of the deposit is applicable.

For the second and subsequent transfers, ten rupees for every one lakh rupees deposit is applicable.

Can an NRI open account under senior citizen's scheme?

No, an NRI is not allowed to open an account under this scheme. If someone becomes an NRI after the opening of the account, the account will continue until the maturity on a non-repatriation basis.

Can a Hindu Undivided Family open account under this scheme?

No, a Hindu Undivided Family is not allowed to open the account under this scheme.

What is the maturity period of the scheme?

The account matures after five years from the date of opening of the account. The account can be extended to a period of 3 years. For the extension, the depositor has to fill up the application in Form B and deposit the filled form to his deposit office within one year after the maturity.

What are the rules for premature closure of the account?

You can't close the account within one year of the opening of the account. However, if the account has been more than one year old, the following rules are applicable for closure.

1.5% of the deposit will be deducted and the remaining balance will be paid to the depositor if the account is closed after one year but before 2 years of the opening of the account.
If the account is closed after 2 years of the opening of the account, 1% of the deposit is deducted and the remaining amount is paid to the depositor.
However, if the account has already completed five years and is under extension then such deductions are not applicable and you can withdraw money at any time.

What are the rules to close the account?

The account can be closed after five years from the date of the deposit by filling the application in Form E(withdrawal form) along with the passbook of the account.
However, if the depositor neither closes the account on maturity nor applies for extension then the account is considered to be closed.

How can I get different forms to operate in the account?

The scheme is launched by the Government of India under the national savings institute. The forms and other information can be accessed at this link.

Can we save tax under section 80C of income tax by depositing in this scheme?

Yes, you can save tax under 80 C of income tax. However, the interests earned on the deposits are taxed. The scheme follows provisions of tax deducted from source.

Should we really invest money in this scheme?

The scheme is worth choosing for investment because you get good returns

in comparison to other debt investments and your money is safe.

Have you subscribed for senior citizen's savings scheme? How is your experience? Please don't forget to share your thoughts about the scheme in comments.

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