Negative aspects of the Senior Citizen Savings Plan: Exciting news! Before making an investment in SCSS, be aware of these five drawbacks

 Negative aspects of the Senior Citizen Savings Plan: Exciting news! Before making an investment in SCSS, be aware of these five drawbacks

The SCSS, or Senior Citizen Savings Scheme Compared to other Post Office programs, the Senior Citizen Savings Scheme offers higher interest rates on investments. Let's talk about its drawbacks in more depth.

The Post Office's Senior Citizen Savings Scheme (SCSS) is a well-liked program. Investment in this program is restricted to those above 60 years of age, since it is specifically created for elderly folks. While there are several benefits to investing in it, we should be aware of the drawbacks as well before making a decision.

Rate of interest for the Senior Citizens Savings Plan

For the month of July through September, banks and post offices are paying 8.2 percent interest on SCSS, in accordance with the interest rate set by the government. The interest rate does not change once it is invested until it matures.

Investment Cap for the Senior Citizen Savings Plan

There are restrictions on investments made in Senior Citizen Savings Plans. There is a maximum amount that one may invest in this. Its previous investment cap of Rs 15 lakh has been raised to Rs 30 lakh in Budget 2023.

TDS in regard to SCSS

You must pay TDS if your interest on SCSS within a financial year exceeds Rs 50,000.

Interest's benefit to interest

Investors in SCSS get interest payments on a quarterly basis. This interest must be claimed by investors each quarter. No interest is paid on the whole amount of interest if they fail to comply.

Age Restrictions and Lock-in Times

Only those who are 60 years of age or older may invest in the Senior Citizen Savings Program. It has a five-year lock-in term. You may prolong its maturity for an additional three years once it is finished.