Financial Savings Scheme
Financial Savings Scheme constitutes products which helps you to gradually build on your wealth. The basic aim of these products is to inculcate a saving habit among all individuals. The minimum amount of contribution is very low and the product is easily available to the common mass. These schemes ensure that your capital is protected. With this protection, the investors are paid pre-determined interests which add to their savings. The interest may be fixed at the beginning of the term or it may be declared at the beginning of the financial year.
In most of the schemes, the investment is considered investment under section 80c of Income Tax Act.
The most common schemes are :
- Post Office Monthly Income Scheme (MIS)
- Public Provident Fund (PPF)
- National Savings Certificate (NSC)
- Senior Citizen Savings Scheme (SCSS)
- Sukanya Samriddhi Scheme (SSS)
These schemes are distributed to the public through Post offices and Public Sector Banks. These schemes are very helpful for people with limited means to park their savings. Keeping their savings at home brings them with two risks. They may lose the money or they may have the propensity to spend their hard earned money. These schemes also have a social implication.
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I totally believe in some good investment plans, it helps one in long term and definitely on the tax front. I was aware of all the schemes mentioned in the post, but Sukanya Samriddhi Accounts, was a new one to me. I have invested in PPF, and is quite happy with it. Detailed explanation on each investment scheme under one roof. Great Post!!
The best part about these schemes are that they incalcate a healthy saving habbits thus securing the future plus giving the tax benefit. These financial saving schemes are easily available from the post office and the banks and are within the reach of a common man. From time to time the Goverment also starts up new schemes to benefit its citizen.
When you are young, with no worries over your head, there is no need for a savings scheme. As you are getting older, your thinking changes drastically. As the retirement is approaching and you are not quite sure what is waiting for you in the future, you change your point of view and financial savings scheme becomes an interesting possibility.