Latest news with #NationalSavingsCertificate
News18
2 days ago
- Business
- News18
Planning For Your Child's Future? Explore SSY, NPS Vatsalya, MFs, PPF, And Bank FDs
Last Updated: Parents naturally want to secure their children's future, and making wise investment choices can help build long-term financial stability Investment Plans For Children: Parents naturally want to ensure a secure future for their children. Making informed investment choices can be crucial in achieving long-term financial stability and growth. While financial planning can seem daunting, a systematic and disciplined approach can lead to significant wealth accumulation. India offers various investment schemes designed to provide both security and growth. Let's explore some of the most effective options: Sukanya Samriddhi Yojana (SSY) SSY is a government-backed savings scheme focused on the financial security of girl children. Parents or legal guardians can open an account for a girl child below 10 years. The account matures after 21 years or upon the girl's marriage after turning 18. As of 2025, the interest rate stands at 8.2%, compounded annually. Deposits range from ₹250 to ₹1.5 lakh annually, with tax benefits under Section 80C. Public Provident Fund (PPF) The PPF is a long-term government-backed investment option offering a current interest rate of 7.1% (revised quarterly). The interest earned is tax-free, and contributions qualify for tax deductions under Section 80C. With a 15-year lock-in period, PPF is ideal for long-term goals like funding higher education. National Savings Certificate (NSC) NSC is a fixed-income investment option with a five-year maturity period. It offers competitive interest rates (revised periodically) and tax benefits under Section 80C. The interest earned is reinvested, making NSCs a safe choice for accumulating funds for a child's education. ULIPs combine insurance and investment. Part of the premium goes toward life insurance, while the rest is invested in equity or debt instruments. ULIPs have a five-year lock-in and offer potential for higher returns, depending on market performance. They provide tax benefits under Section 80C, but it's important to review associated charges and risks before investing. Mutual Fund SIPs Systematic Investment Plans (SIPs) allow regular investments in mutual funds, promoting financial discipline and harnessing the power of compounding over time. Fixed Deposits (FDs) Bank FDs remain a popular choice for conservative investors due to their safety and assured returns. While interest rates are usually lower than market-linked options, special FDs for children can help fund educational expenses and other needs. Before choosing an investment, evaluate the risk, return potential, and lock-in period of each option. Diversifying across different schemes can also help reduce risk and maximize returns, ensuring a secure financial future for your child.
Time of India
23-05-2025
- Business
- Time of India
Investors shift to RBI floating rate bonds as fixed deposit rates slide
With fixed deposit rates steadily declining due to Reserve Bank of India (RBI) rate cuts and abundant liquidity, risk-averse investors are turning their attention to the RBI's floating rate savings bonds. These bonds currently offer attractive annual yields of up to 8.05% for a 7-year tenure, providing a more lucrative and safer alternative to traditional fixed deposits. 'Corporate and bank deposit rates have come down in line after the rate cuts announced by RBI,' Anup Bhaiya, MD and CEO of Money Honey Financial, a Mumbai-based distributor told ET. 'However, since the RBI floating rate deposit rates continue to be unchanged at 8.05%, there is higher demand for these deposits from retail investors.' These bonds, issued by the central bank on behalf of the government, are considered highly safe and offer a 35-basis-point premium over returns promised by the National Savings Certificate. Currently, the bonds provide an interest rate of 8.05%, paid semi-annually, with the rate reset every six months. Interest income from these bonds is taxable. Despite their safety, liquidity remains a challenge. 'There is no premature withdrawal option, and these bonds cannot be used as collateral for borrowing, and hence, investors must be sure to buy and hold them until maturity,' explained Harshvardhan Roongta, CEO of Roongta Securities. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 5 Books Warren Buffett Wants You to Read In 2025 Blinkist: Warren Buffett's Reading List Undo The minimum investment amount is ₹1,000, with no upper investment limit. Following RBI's cumulative 50 basis points rate cut since February, both banks and deposit-taking non-bank lenders have reduced deposit rates by 25 to 100 basis points. The current 10-year government bond benchmark yields 6.22%. For comparison, Bajaj Finance, rated AAA, offers 7.25% for deposits between 24 to 60 months, while SBI pays 6.3% for deposits spanning 5 to 10 years. Senior citizens can earn 50 to 100 basis points more. Investors can purchase these bonds through the RBI retail direct website, distributors, or private bank websites. 'These bonds help you earn a lucrative 180 basis points over the 10-year benchmark government bond, while over fixed deposits and corporate deposits these bonds help you earn around 65-150 basis points more,' said Vikram Dalal, Managing Director of Synergy Capital. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
23-05-2025
- Business
- Economic Times
Are RBI floating rate bonds the best option as FD rates plummet?
Investors are showing increased interest in the Reserve Bank of India's floating rate savings bonds. These bonds offer annual yields up to 8.05% for a seven-year term. Fixed deposit rates are declining, making these bonds attractive. The bonds provide a 35-basis-point markup over the National Savings Certificate. While safe, they lack liquidity and cannot be prematurely withdrawn. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: Risk-averse savers are increasingly turning to the Reserve Bank of India 's (RBI) floating rate savings bonds , which promise annual yields of up to 8.05% for a 7-year tenure, as fixed deposit rates head south quickly amid modest credit growth, ample liquidity, and expectations of further policy rate reductions."Corporate and bank deposit rates have come down in line after the rate cuts announced by RBI," said Anup Bhaiya, MD and CEO, Money Honey Financial - a Mumbai-based distributor. "However, since the RBI floating rate deposit rates continue to be unchanged at 8.05%, there is higher demand for these deposits from retail investors."These bonds, issued by the central bank on behalf of the government, come with high safety and pay a 35-basis-point mark-up over the returns promised by the National Savings works out currently to 8.05% and has a tenure of seven years, with interest paid once every six months. This interest rate could also change once every six months, and the interest income is taxable for the be sure, these bonds, although sovereign backed, do not have a liquid market, and investors need to hold them until maturity."There is no premature withdrawal option, and these bonds cannot be used as a collateral for borrowing, and hence, investors must be sure to buy and hold them until maturity," said Harshvardhan Roongta, CEO, Roongta minimum investment is ₹1,000 and there is no upper limit on investments in these said both deposit-taking non-bank lenders and banks have slashed rates by 25 to 100 basis points after RBI reduced the policy rate by a cumulative 50 basis points since 10-year benchmark yields investors 6.22%.After the rate cuts, Bajaj Finance that has a AAA rating pays 7.25% for a 24-60 month deposit, while SBI pays 6.3% for a deposit between 5 and 10 years. Senior citizens could earn 50-100 basis points can log on to the RBI retail direct website to buy these bonds, or can buy them from a distributor or private bank websites easily. "These bonds help you earn a lucrative 180 basis points over the 10-year benchmark government bond, while over fixed deposits and corporate deposits these bonds help you earn around 65-150 basis points more," said Vikram Dalal, managing director, Synergy Capital.
Time of India
23-05-2025
- Business
- Time of India
Are RBI floating rate bonds the best option as FD rates plummet?
Mumbai: Risk-averse savers are increasingly turning to the Reserve Bank of India 's (RBI) floating rate savings bonds , which promise annual yields of up to 8.05% for a 7-year tenure, as fixed deposit rates head south quickly amid modest credit growth, ample liquidity, and expectations of further policy rate reductions. "Corporate and bank deposit rates have come down in line after the rate cuts announced by RBI," said Anup Bhaiya, MD and CEO, Money Honey Financial - a Mumbai-based distributor. "However, since the RBI floating rate deposit rates continue to be unchanged at 8.05%, there is higher demand for these deposits from retail investors." by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Semua yang Perlu Anda Ketahui Tentang Limfoma Limfoma Pelajari Undo These bonds, issued by the central bank on behalf of the government, come with high safety and pay a 35-basis-point mark-up over the returns promised by the National Savings Certificate. Bonds Corner Powered By Are RBI floating rate bonds the best option as FD rates plummet? Investors are showing increased interest in the Reserve Bank of India's floating rate savings bonds. These bonds offer annual yields up to 8.05% for a seven-year term. Fixed deposit rates are declining, making these bonds attractive. The bonds provide a 35-basis-point markup over the National Savings Certificate. While safe, they lack liquidity and cannot be prematurely withdrawn. Why are Japanese bond yields rising and what does it mean for Indian investors? Kumar Mangalam Birla's Grasim gets cheapest rupee bond deal in 5 years Can India bond yields fall lower than that of US? Uday Kotak wonders India bond yields continue downward trend on bets of policy easing Browse all Bonds News with That works out currently to 8.05% and has a tenure of seven years, with interest paid once every six months. This interest rate could also change once every six months, and the interest income is taxable for the investor. Liquidity Challenges Live Events To be sure, these bonds, although sovereign backed, do not have a liquid market, and investors need to hold them until maturity. "There is no premature withdrawal option, and these bonds cannot be used as a collateral for borrowing, and hence, investors must be sure to buy and hold them until maturity," said Harshvardhan Roongta, CEO, Roongta Securities. The minimum investment is ₹1,000 and there is no upper limit on investments in these bonds. Distributors said both deposit-taking non-bank lenders and banks have slashed rates by 25 to 100 basis points after RBI reduced the policy rate by a cumulative 50 basis points since February. The 10-year benchmark yields investors 6.22%. After the rate cuts, Bajaj Finance that has a AAA rating pays 7.25% for a 24-60 month deposit, while SBI pays 6.3% for a deposit between 5 and 10 years. Senior citizens could earn 50-100 basis points more. Investors can log on to the RBI retail direct website to buy these bonds, or can buy them from a distributor or private bank websites easily. "These bonds help you earn a lucrative 180 basis points over the 10-year benchmark government bond, while over fixed deposits and corporate deposits these bonds help you earn around 65-150 basis points more," said Vikram Dalal, managing director, Synergy Capital.
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Business Standard
22-05-2025
- Business
- Business Standard
SCSS vs NSC vs Debt Funds: Which fixed-income option is the best in 2025?
When it comes to generating stable, tax-efficient returns, investors in India often find themselves torn between traditional savings instruments like the Senior Citizens' Savings Scheme (SCSS) and the National Savings Certificate (NSC), or newer, more market-linked options like debt mutual funds. With interest rates, tax rules, and inflation all evolving, how do these options compare today? More importantly, which one should you pick based on your needs? The Contenders: What are they? Fixed-rate small saving schemes vs debt mutual funds. Source: Value Research 1. SCSS (Senior Citizens' Savings Scheme) For: Individuals aged 60 and above Interest Rate (April–June 2025): 8.2% p.a. (paid quarterly) Tenure: 5 years (extendable by 3 years) Tax Benefits: Eligible for Section 80C deduction (up to Rs 1.5 lakh) Interest is taxable, but TDS is applicable if interest exceeds Rs 50,000/year Best for: Retirees seeking regular income with government guarantee 2. NSC (National Savings Certificate) For: Any Indian citizen Interest Rate (April–June 2025): 7.7% p.a. (compounded annually, paid at maturity) Tenure: 5 years Tax Benefits: Principal qualifies for Section 80C Interest is taxable, but reinvested interest (except final year) also qualifies for Section 80C Best for: Conservative investors with a 5-year horizon, who don't need regular income 3. Debt Mutual Funds For: Investors of all ages Returns: 6–8% on average, can be higher/lower depending on type Taxation (Post-2023 rules): Gains taxed at slab rate (no LTCG benefit) No Section 80C benefit Indexation benefit abolished for debt funds Best for: Investors seeking liquidity and diversification, with some risk tolerance Comparative Snapshot Which one should you choose? For Senior Citizens: Value Research recommends SCSS Why: It offers high assured returns and quarterly payouts, ideal for retirees needing regular income. Example: Mrs. Rani, 65, invests Rs 15 lakh in SCSS. She earns Rs 30,750 every quarter, providing her with predictable income while her capital remains safe. For Salaried Taxpayers Saving for 5 Years: Choose: NSC Why: If you want a fixed return and tax savings under 80C but don't need liquidity, NSC fits the bill. Example: Sanjay, 35, wants a tax-saving investment but already maxes out EPF and PPF. He invests ₹1.5 lakh in NSC. In 5 years, he gets back ₹2.2 lakh, earning steady compounded returns without taking any market risk. For Working Professionals with Moderate Risk Appetite: Choose: Debt Mutual Funds Why: If you value liquidity and want to diversify with dynamic returns, debt funds (like low duration, short-term, or corporate bond funds) are suitable. Example: Priya, 40, keeps ₹5 lakh in a corporate bond fund yielding 7.2%. She holds it for 2 years and exits without penalty when she needs the money for her child's school admission. Caution: Tax rules have changed Post-April 2023, debt funds lost their long-term capital gains (LTCG) tax benefit and indexation advantage. Now, all gains — even after 3 years — are taxed as per slab rate. This reduces their edge over traditional instruments, especially for those in the highest tax bracket (30%). Tip: Tax-aware investors in higher brackets should lean toward SCSS or NSC unless they need liquidity. There's no one-size-fits-all answer. Your life stage, income needs, tax bracket, and risk appetite should drive the decision. As per Value Research:
