What is Sukanya Samriddhi Yojana?
Sukanya Samriddhi Yojana (SSY) is a government-backed savings scheme for the education and marriage of a girl child. A parent or guardian can open an account for a daughter below the age of 10 at a post office or an authorised bank.
You deposit money every year for 15 years from the date the account is opened. The account matures 21 years after it is opened, and the balance keeps earning interest for the last 6 years even though you no longer deposit.
The interest rate is set by the government every quarter and is one of the highest among small savings schemes. The deposits, the interest and the maturity amount are all tax-free.
Fun fact
You can open an SSY account with as little as ₹250 a year, so even small, regular savings can grow into a meaningful amount by the time your daughter turns 21.
What is an SSY Calculator?
An SSY calculator works out how much your daughter’s SSY account will be worth when it matures, based on how much you deposit each year and the current rate of interest. It also shows the year in which the account matures.
The result assumes the current rate stays the same for all 21 years. If the government changes the rate, the actual maturity amount will be different.
Why you should use an SSY Calculator?
- Plan for her future: See how much will be available for your daughter’s higher education or marriage.
- Choose a yearly deposit: Try different amounts, from ₹250 up to ₹1,50,000 a year, to find one that meets your goal.
- Know when it matures: See the year the account matures, so you can plan around it.
How Does an SSY Calculator Work?
The SSY calculator works on the following inputs:
- Yearly Investment: The amount you deposit every year for 15 years.
- Girl’s Age: Your daughter’s age when the account is opened. It must be 10 or below; it doesn’t change the maturity amount.
- Start Period: The year you open the account. It matures 21 years later.
- Latest SSY Rate: The current rate of interest, set by the government.
The calculator relies on the following formula:
M = P × [((1 + i)^15 − 1) ÷ i] × (1 + i) × (1 + i)^6
- M
- Maturity amount
- P
- Yearly investment
- i
- Yearly rate of interest (rate ÷ 100)
The first part is the value of 15 yearly deposits made at the start of each year. The last part, (1 + i)^6, is the interest earned in the 6 years after deposits stop. Interest is compounded once a year.
Formula to Calculate SSY with an Example
Consider an example for a better understanding.
- Yearly Investment: ₹1,00,000
- Rate of Interest: 8.2% per annum
- Start Period: 2026, so the account matures in 2047
Using the formula:
M = 1,00,000 × [((1.082)^15 − 1) ÷ 0.082] × 1.082 × (1.082)^6
After calculation, the maturity amount is about ₹47,88,079. You invest ₹15,00,000 in total, and earn about ₹32,88,079 as interest.
Things to keep in mind
- Deposit before the 5th of April: Interest is worked out on the lowest balance between the 5th and the end of each month, so depositing before the 5th of April earns interest for the whole year.
- Minimum deposit: Deposit at least ₹250 every year, or the account becomes inactive until you pay a small penalty.
- Early withdrawal: Once your daughter turns 18 or passes Class 10, up to 50% of the balance can be withdrawn for her education.
- Tax benefit: Deposits up to ₹1,50,000 a year can be claimed as a deduction under Section 80C in the old tax regime.