PPF, SCSS To NSC: Here Are Some Safe Investment Options For Conservative Investors

These small savings instruments provide conservative investors with a range of safe investment options, offering a blend of regular income, tax benefits, and guaranteed returns

For conservative investors seeking safe and secure financial instruments, Fixed Deposits (FDs) have long been a popular choice. However, there are other viable options available, such as small savings schemes and post office savings schemes that offer assured returns along with the benefit of tax exemptions.

These schemes include the Public Provident Fund (PPF), Senior Citizens Savings Scheme, Monthly Income Account, National Savings Certificate (NSC), Kisan Vikas Patra (KVP), Sukanya Samriddhi Account (SSA), and Post Office Savings Account.

Like FDs, these instruments are considered low-risk and come with guaranteed returns. Additionally, they offer tax benefits under Section 80C of the Income Tax Act, allowing up to Rs 1.5 lakh in annual tax exemptions.

Here's a closer look at some of the most common small savings schemes:

Public Provident Fund (PPF)

Interest Rate: 7.1 per cent per annum

Minimum Investment: Rs 500

Maximum Investment: Rs 1.5 lakh per financial year

Withdrawal: One withdrawal allowed after five years, with a limit of 50 per cent of the balance at the end of the 4th preceding year or the preceding year, whichever is lower.

Monthly Income Account

Interest Rate: 7.4 per cent per annum

Minimum Investment: Rs 1,000

Maximum Investment: Rs 9 lakh in a single account, Rs 15 lakh in a joint account

This scheme offers monthly income for investors, making it a popular option for regular cash flow.

Senior Citizens Savings Scheme (SCSS)

Interest Rate: 8.2 per cent per annum

Investment Limit: Maximum deposit of Rs 30 lakh in multiples of Rs 1,000

Specifically designed for senior citizens, this scheme offers higher interest rates and regular income.

Post Office Savings Account

Interest Rate: 4 per cent per annum

Minimum Investment: Rs 500

This scheme offers a low-risk, liquid investment option with guaranteed returns, ideal for individuals seeking safe savings.

Post Office Recurring Deposit Account

Interest Rate: 6.7 per cent per annum

Minimum Investment: Rs 100 per month

There is no maximum limit for investment in this scheme, allowing for flexible contributions.

National Savings Certificate (NSC)

Interest Rate: 7.7 per cent per annum, compounded annually

Minimum Investment: Rs 1,000

There is no maximum limit on investment. The NSC offers tax benefits and is often used for long-term savings.

Kisan Vikas Patra (KVP)

Interest Rate: 7.5 per cent per annum, compounded annually

Minimum Investment: Rs 1,000

No maximum limit for investment. The KVP is a long-term investment option and provides guaranteed returns.

Sukanya Samriddhi Account (SSA)

Interest Rate: 8.2 per cent per annum

Minimum Investment: Rs 250

Maximum Investment: Rs 1.5 lakh per year

This scheme is aimed at encouraging savings for the girl child and offers tax benefits under Section 80C.

These small savings instruments provide conservative investors with a range of safe investment options, offering a blend of regular income, tax benefits, and guaranteed returns.