When it comes to
safe and guaranteed savings, two government-backed schemes often stand out for investors:1.
Sukanya Samriddhi Yojana (SSY) – specifically for the girl child.2.
Public Provident Fund (PPF) – a long-term investment option for everyone.Let’s compare these two to see
where your ₹1 lakh investment will grow faster and which offers better returns.
1️⃣ Interest Rates and Returns
SchemeCurrent Interest Rate (FY 2025-26)Investment TenureTax BenefitsSSY8% per annum (compounded yearly)21 years from account opening100% tax-free under Section 10(11) of IT Act
PPF7.1% per annum (compounded yearly)15 years (extendable)Contributions and interest tax-free (EET)·
SSY currently offers a slightly higher interest rate than PPF, meaning your corpus will grow faster if you invest the same amount.· The
interest in both schemes is compounded annually, which helps in building a substantial corpus over time.
2️⃣ Corpus Growth on ₹1 Lakh Investment
Assuming a
single investment of ₹1 lakh:·
SSY (8% for 21 years) → Corpus: ~₹6.85 lakh·
PPF (7.1% for 15 years) → Corpus: ~₹2.8 lakhIf you are looking purely at
fund growth and long-term returns, SSY clearly outperforms PPF due to a combination of
higher interest and longer compounding period.
3️⃣ Key Differences
FeatureSSYPPFPurposeFor girl child’s education and marriageLong-term savings & retirement planning
Tenure21 years15 years (extendable in blocks of 5 years)
Maximum Annual Investment₹1.5 lakh₹1.5 lakh
Tax BenefitsFully tax-freeFully tax-free
Early WithdrawalOnly in specific cases (marriage/education)Partial withdrawals allowed after 5 years
4️⃣ Which One Should You Choose?
·
SSY: Ideal if you want
higher returns for your daughter’s future, with tax-free benefits and guaranteed government backing.·
PPF: Best for
general long-term savings and retirement, with more flexibility in withdrawals.
Bottom line: For a
₹1 lakh investment,
SSY will create a bigger fund first, thanks to a higher interest rate and longer maturity.
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