How much SCSS interest will you get? Let's break it down

The Senior Citizens Savings Scheme (SCSS) is a favourite among retirees who seek steady, risk-free income backed by the government. Designed specifically for individuals aged 60 years and above, it ensures a secure way to park retirement savings while generating regular payouts. While this stability is reassuring, it often raises questions such as: How is SCSS interest calculated? If rates change later, will I get a higher return? What happens after the maturity period? Let's break down the most common queries and calculations so you can better understand how much interest you will receive from SCSS. 1. What is the SCSS interest rate for this quarter? The current SCSS interest rate is 8.2 per cent per annum for the January-March 2024 quarter, the same as it has been for the last several quarters. When was it last changed? The last revision was in January 2023, when the rate was increased from 7.6 per cent to 8.0 per cent, followed by a further hike to 8.2 per cent in April 2023. Since then, it has remained steady. What you should know Interest rates for SCSS are reviewed every quarter by the government, but once you invest, your rate stays locked for the entire investment tenure. 2. If the SCSS rate changes after I invest, will my interest also change? No. The SCSS works on a fixed interest rate model. The interest rate applicable on the day of your deposit remains locked for the entire five-year tenure. Even if the government raises or lowers the SCSS rate in future quarters, your investment will continue earning at the rate you secured on the date of deposit. Example: If you invested Rs 10 lakh in January 2023 when the rate was 8 per cent, you will continue earning 8 per cent for the next five years, even when the rate was hiked to 8.2 per cent. 3. How much SCSS interest will I get? SCSS interest is calculated and paid quarterly. Formula: (Principal × Interest Rate) ÷ 4 = Quarterly Interest Payment Illustration: Principal: Rs 10 lakh Interest Rate: 8.2 per cent per annum Quarterly payout: Rs 10,00,000 × 8.2% ÷ 4 = Rs 20,500 Annual payout: Rs 20,500 × 4 = Rs 82,000 When is it paid? The payouts are made at the beginning of every quarter— April 1, July 1, October 1 and January 1. 4. What happens if I extend my SC

This article was originally published on January 06, 2025.