Sukanya Samriddhi Yojana vs Fixed Deposit

Fixed deposit and Sukanya Samriddhi Yojana (SSY) are two popular investment tools. But if you want to know which is better for you, you need to make a detailed comparison between Sukanya Samriddhi Yojana vs FD. 

The Sukanya Samriddhi Yojana is a government scheme launched for the welfare of a girl child in the family. It encourages parents or guardians of the girl child to make small savings for her higher education and marriage expenses. 

This scheme, launched under the ‘Beti Bachao, Beti Padhao’ initiative, enables parents/legal guardians of a girl child to open an account in her name. This account can be opened until she turns 10. 

Like fixed deposits, this savings scheme offers guaranteed returns to all depositors. However, the two investment tools have multiple dissimilarities. Read on to dive deeper into understanding Sukanya Samriddhi Yojana vs FD.

Difference Between Sukanya Samriddhi Yojana and Fixed Deposits

The below table points out the key differences between Sukanya Samriddhi Yojana and fixed deposit.

To better understand the instrument, consider the following pointers.

1. Interest Rate

The interest rate for Sukanya Samriddhi Yojana is decided by the Central Government every quarter. Currently, the interest rate for SSY is 8%, and the FD interest rate is decided by the bank or NBFC and is revised regularly.

2. Eligibility

Since SSY is for a girl child, parents or legal guardians can open a bank account for the baby girl right after her birth. This scheme can only be availed till the girl reaches the age of 10 years.

Whereas you need to be 18 or more to book a fixed deposit scheme, parents can also open FD accounts in their children’s names. Your children can avail of its benefit after turning 18.

3. Minimum and Maximum Deposit

With Sukanya Samriddhi Yojana, you can start your savings account with a minimum of ₹250, whereas the maximum investment amount is ₹1.5 Lakhs annually. 

For fixed deposits, the minimum deposit amount differs from bank to bank. At Bajaj Markets, you can open an FD account with an amount as low as ₹1,000.

3. Tenor

The lock-in period for SSY is until the girl reaches the age of 21 years or when the girl gets married (whichever is earlier). Additionally, this scheme also enables you to make partial withdrawals for the girl’s higher education once she turns 18.

In the case of fixed deposits, every bank and NBFC has a different tenor. At Bajaj Markets, you can opt for the right lock-in period based on your financial goals from a flexible tenor ranging from 7 days to 10 years.

4. Premature Withdrawal

SSY enables you to make premature withdrawals, however, only under special conditions. One such special situation could be the untimely death of the account holder. 

On the other hand, fixed deposits also allow premature withdrawals, but you may have to pay a nominal penalty.

5. Tax Benefits

Both SSY and FDs are tax-saving instruments. However, you need to opt for the 5-year tax-saver FD to avail of income tax exemption.

6. Tenor Extension

With a Sukanya Samriddhi Yojana account, the account matures once the girl child reaches 21 years of age or get married. Extensions are not allowed beyond the 21-year mark. 

However, fixed deposits do not allow extension. The entire principal amount and the interest earned are withdrawn at the time of maturity. However, you can always opt for automatic FD renewal if you wish to stay invested.

The SSY vs FD comparison reveals that both have their own merits and demerits. Though Sukanya Samriddhi Yojana offers a higher interest rate, it is limited to girls. 

However, a fixed deposit is more than just a savings tool with a flexible tenor. Moreover, it offers additional benefits like a loan against FD and a nomination facility.

At Bajaj Markets, you can choose from a range of fixed deposit schemes that can assist you in compounding your money. To make an informed investment decision, you need to assess the returns with different financial entities.  

For this purpose, you can use the Bajaj Markets online FD calculator, which takes in your inputs and determines your maturity amount in an instant. 

With the highest safety ratings, you can be assured that we have built a secure environment for your money to grow for you. So, visit our ‘Fixed Deposit’ page and start now!