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SSY vs PPF vs FD: Which is best for your daughter’s future? Discover which option yields the safest and highest returns.
SSY gives the best long-term returns for your girl child, followed by PPF and FD. (Representative Image)
Planning for your child’s future is one of the most important financial decisions a parent can make. Choosing the right investment tool not only ensures a secure future but also maximises returns over time.
When it comes to long-term savings for your girl child, options like Sukanya Samriddhi Yojana (SSY), Public Provident Fund (PPF), and Fixed Deposits (FDs) are popular choices.
Each comes with unique features, tax benefits, and returns. But which one should you pick for higher returns and financial safety?
Sukanya Samriddhi Yojana (SSY)
SSY is a government-backed scheme exclusively for girl children, offering one of the highest interest rates among small savings schemes — currently at 8.2% per annum (as of Q1 FY 2025).
Parents or guardians can open the account for a girl under 10 years of age. The maturity period is 21 years or until the girl’s marriage after 18. Partial withdrawal is allowed at 18 for educational purposes.
Contributions qualify for tax deductions under Section 80C, and both interest and maturity amounts are tax-free. The long lock-in ensures disciplined saving, making it ideal for long-term goals like education or marriage.
Public Provident Fund (PPF)
PPF is another government-backed savings option with a current interest rate of 7.1 per cent per annum. It has a 15-year maturity period and can be extended in 5-year blocks.
Like SSY, PPF offers EEE (Exempt-Exempt-Exempt) tax benefits. Partial withdrawals and loans are allowed from the 7th and 3rd year, respectively. Though not exclusive to girl children, PPF remains a low-risk, steady-growth option for long-term investments.
Fixed Deposit (FD)
Bank FDs are the most flexible option, with tenure options ranging from 7 days to 10 years. Current interest rates range from 6 per cent –7.5 per cent, depending on the bank and tenure.
Though FD interest is taxable, it offers liquidity and is less rigid than SSY or PPF. Some banks provide child-specific FDs, but the returns and tax benefits are usually lower.
When planning for your girl child’s future, Sukanya Samriddhi Yojana stands out with the highest interest rate, tax-free returns, and girl-child-centric benefits. PPF offers safety and tax perks but with slightly lower returns. FDs, while flexible, fall short in long-term growth. For better returns, SSY is the most rewarding option.
A team of writers and reporters decodes vast terms of personal finance and making money matters simpler for you. From latest initial public offerings (IPOs) in the market to best investment options, we cover al…Read More
A team of writers and reporters decodes vast terms of personal finance and making money matters simpler for you. From latest initial public offerings (IPOs) in the market to best investment options, we cover al… Read More
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Delhi, India, India
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