Senior Citizens Savings Scheme

The Senior Citizens Savings Scheme (SCSS) offers regular income, highest safety and tax saving, making it a popular product for those over 60 years of age. 

Post retirement, people are looking for investment avenues to park their retirement corpus in. They are hesitant to put their hard-earned money in equities, which carry capital loss risk, or products which come with a long lock-in period and don't offer any income till maturity. 

Retirees are looking for products that are less risky and can also minimise their tax outgo. This is where SCSS comes in. SCSS offers capital protection, along with quarterly interest payment as a source of income. The scheme is backed by the government and, therefore, offers a sovereign guarantee. Interest income from SCSS can also help retirees bridge the gap between their pension and the last salary drawn. 

Who can invest in SCSS? 
As the name suggests, any individual aged 60 and above can invest in it. Early retirees between 55 and 60 years, who either opted for the voluntary retirement scheme (VRS) or superannuation, can also invest in the scheme, provided the investment is done within a month of receiving retirement benefits. 

Earlier, retired defence personnel were allowed to invest in this scheme irrespective of their age, subject to other conditions. However, on October 3, 2017 the government issued a notification stating that the investment age has been fixed at 50 years. 
However, non-resident Indians (NRIs) and Hindu Undivided Families (HUFs) are not allowed to invest SCSS.

How to invest? 
A senior citizen can invest in this scheme by opening either an individual or a joint (along with the spouse) account with a post office or a scheduled commercial bank. 

How much can one invest? 
An individual, singly or jointly, can open an SCSS account by investing up to Rs 15 lakh (in multiples of Rs 1,000) only. The amount invested in the scheme also cannot exceed the money one receives on retirement. Therefore, one can invest either Rs 15 lakh or the amount received as a retirement benefit, whichever is lower.

The account can be opened by cash for amounts below Rs 1 lakh and by cheque only for Rs 1 lakh and above, as per the senior citizen scheme rules on the Income Tax website. The investment date in the scheme is taken as the date on which the cheque is realised in the government's account.