Sukanya Samriddhi Yojana vs Mutual Funds: Exploring Investment Options for Your Daughter’s Future

The Sukanya Samriddhi Yojana (SSY), a government-run scheme aimed at securing the financial future of daughters, offers an attractive interest rate of 8.2%. If you have a daughter under the age of 10, you can invest in this scheme to ensure a substantial return. Under SSY, a minimum of Rs 250 and a maximum of Rs 1.5 lakh must be deposited annually for 15 years, with the scheme maturing after 21 years.

Alternatively, parents can consider investing in mutual funds in their daughter’s name for potentially higher returns. Through Systematic Investment Plans (SIP), you can invest a fixed amount monthly over a long term.

Comparative Analysis: SSY vs. Mutual Funds

Sukanya Samriddhi Yojana (SSY):

• Investment: ₹5000 per month
• Total Investment: ₹9,00,000 over 15 years
• Interest Rate: 8.2%
• Maturity: 21 years
• Total Amount on Maturity: ₹27,71,031
• Principal: ₹9,00,000
• Interest: ₹18,71,031

Mutual Funds (SIP):

• Investment: ₹5000 per month
• Total Investment: ₹9,00,000 over 15 years
• Average Return: 12%
• Total Amount after 15 years: ₹25,00,000
• Principal: ₹9,00,000
• Interest: ₹16,00,000
• Total Amount after 21 years (continued investment): Approximately ₹44,00,000

Key Points

• Sukanya Samriddhi Yojana: Provides a guaranteed return with a fixed interest rate, making it a secure investment option. However, the money remains locked in until the daughter turns 21.
• Mutual Funds: Offer potentially higher returns with market-linked investments. Though there is an element of risk, the average return of 12% can significantly enhance the investment amount over time.

Both investment options serve distinct purposes. Sukanya Samriddhi Yojana offers stability and guaranteed returns, ideal for risk-averse investors seeking secure growth. Mutual funds, on the other hand, cater to those willing to embrace market risks for potentially higher returns. Choosing between the two depends on individual risk tolerance and financial goals for securing your daughter's future.

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