10 Best Saving Schemes in India 2024
Saving money effectively is essential for financial security, but with so many options available, it’s often overwhelming to decide where to invest. From government-backed savings schemes to private sector opportunities, we have plenty of choices — but which options are the best? This article dives deep into the 10 Best Saving Schemes in India 2024 available today to help you make informed, secure, and lucrative decisions with your hard-earned money.
Best Saving Schemes in India 2024
| Scheme Name | Interest Rate (2024) | Lock-In Period | Tax Benefits | Ideal For |
|---|---|---|---|---|
| Public Provident Fund (PPF) | 7.1% | 15 years | Section 80C | Long-term, risk-averse savers |
| National Savings Certificate (NSC) | 7.7% | 5 years | Section 80C | Moderate savers, tax benefits |
| Sukanya Samriddhi Yojana (SSY) | 8.0% | Until girl is 21 | Section 80C | Parents saving for a girl child |
| Senior Citizens Saving Scheme (SCSS) | 8.2% | 5 years | Section 80C | Retirees seeking regular income |
| Post Office Monthly Income Scheme | 6.6% | 5 years | No | Stable income-seekers |
| Fixed Deposits (FD) | 5-7% | Varies | Section 80C (5-year) | Risk-averse, varying lock-in |
| Atal Pension Yojana | Varies | Until age 60 | No | Self-employed, pension seekers |
| Voluntary Provident Fund (VPF) | 8.5% | Until retirement | Section 80C | Employees with long-term focus |
| RBI Bonds | 7.75% | 7 years | No | Safe, fixed-income seekers |
| Kisan Vikas Patra | 6.9% | 124 months | No | Farmers, rural investors |
10 Best Saving Schemes in India 2024
1. Public Provident Fund (PPF): A Safe Bet for Long-Term Goals
Key Features
- Interest Rate: 7.1%
- Lock-in Period: 15 years
- Tax Benefits: EEE (tax-free in all stages)
The Public Provident Fund (PPF) is ideal for long-term financial goals, offering steady growth without any tax liability. Because it’s backed by the government, it’s extremely low-risk and accessible. This scheme suits conservative investors aiming for secure, predictable returns.
Example: Ravi, a 30-year-old software engineer, started a PPF account to secure a retirement corpus, benefitting from compounded growth over time.
2. National Savings Certificate (NSC): Secure and Tax-Saving
Key Features
- Interest Rate: 7.7%
- Lock-in Period: 5 years
- Tax Benefits: Section 80C
The National Savings Certificate (NSC) is a savings bond primarily used by individuals for tax-saving purposes. It’s accessible at post offices, and it’s popular for its fixed returns and moderate lock-in. Interest on NSC is compounded annually, meaning it grows quickly without additional investment.
Example: Meera, a small business owner, chose NSC to diversify her tax-saving portfolio and secure her family’s future.
3. Sukanya Samriddhi Yojana (SSY): Secure Future for Your Daughter
Key Features
- Interest Rate: 8.0%
- Lock-in Period: Until the girl child turns 21 or marriage after 18
- Tax Benefits: Section 80C, EEE
The Sukanya Samriddhi Yojana (SSY) is crafted for parents saving for their girl child’s education and marriage. Offering one of the highest interest rates, it’s a powerful scheme for ensuring a child’s future, and it comes with full tax benefits.
Example: Nisha opened an SSY account for her 5-year-old daughter, allowing her to secure her future education fund with peace of mind.
4. Senior Citizens Saving Scheme (SCSS): Reliable Income for Retirees
Key Features
- Interest Rate: 8.2%
- Lock-in Period: 5 years, with an extension option
- Tax Benefits: Section 80C
The Senior Citizens Saving Scheme (SCSS) is ideal for retirees, offering high interest and regular payouts. This government-backed scheme provides security and peace of mind, with an interest rate better than most fixed-income options.
Example: Rajesh, a retired teacher, invested his savings in SCSS, receiving consistent returns to support his retirement.
5. Post Office Monthly Income Scheme (MIS): Guaranteed Monthly Income
Key Features
- Interest Rate: 6.6%
- Lock-in Period: 5 years
- Tax Benefits: None
The Post Office Monthly Income Scheme (MIS) offers fixed monthly income, suitable for individuals seeking a regular source of income without risking their capital. It’s a low-risk option and comes with assured returns.
Example: Priya, a freelancer, invested in MIS to supplement her irregular income, ensuring financial stability every month.
6. Fixed Deposits (FD): Easy, Safe, and Varied
Key Features
- Interest Rate: 5-7%
- Lock-in Period: Flexible, but tax-saving FD has a 5-year lock-in
- Tax Benefits: Section 80C (for 5-year FD)
Fixed Deposits (FDs) are one of the simplest and safest ways to save, offered by banks and post offices alike. With various tenure options, FDs suit conservative investors aiming for secure returns without market risk. Certain FDs also offer tax benefits under Section 80C.
Example: Sunil uses FDs for easy liquidity and guaranteed returns, with flexible tenure options to suit his lifestyle.
7. Atal Pension Yojana (APY): Pension Scheme for All
Key Features
- Interest Rate: Varies, based on contributions
- Lock-in Period: Until age 60
- Tax Benefits: None
The Atal Pension Yojana (APY) is targeted toward individuals in the unorganized sector, offering a fixed monthly pension after retirement. With government co-contributions for certain income groups, it’s ideal for self-employed individuals and those without pension plans.
Example: Manoj, a shop owner, signed up for APY to ensure a stable retirement income without needing a formal job.
8. Voluntary Provident Fund (VPF): Higher Returns on Salaried Income
Key Features
- Interest Rate: 8.5%
- Lock-in Period: Until retirement or job change
- Tax Benefits: Section 80C
Voluntary Provident Fund (VPF) is an extension of the EPF, offering salaried employees a way to increase their retirement corpus. The high interest rate, coupled with tax-free returns, makes it an attractive choice for salaried individuals.
Example: Ankita, an IT professional, increased her EPF contributions through VPF, resulting in a higher retirement corpus without additional financial products.
9. RBI Bonds: Government-Backed Bonds with Fixed Interest
Key Features
- Interest Rate: 7.75%
- Lock-in Period: 7 years
- Tax Benefits: None
RBI Bonds provide a safe and fixed-income option for investors, with no risk of principal loss. These bonds are suitable for conservative investors aiming for reliable returns and security.
Example: Kavita, a risk-averse investor, preferred RBI Bonds to keep her savings safe while earning a steady income.
10. Kisan Vikas Patra (KVP): Double Your Investment with Ease
Key Features
- Interest Rate: 6.9%
- Lock-in Period: 124 months (10 years, 4 months)
- Tax Benefits: None
The Kisan Vikas Patra (KVP) is a rural-focused scheme designed to double the investment over time. Available at post offices, it’s perfect for long-term investors who prefer simplicity and guaranteed returns.
Example: Satish, a farmer, invested in KVP to ensure he could afford his children’s education expenses in the future.
11. Pradhan Mantri Vaya Vandana Yojana (PMVVY): Steady Income for Senior Citizens
Key Features
- Interest Rate: 7.4% (fixed for the duration of the scheme)
- Lock-in Period: 10 years
- Tax Benefits: Exempt under Section 80C up to ₹1.5 lakh
The Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a pension scheme specifically designed for senior citizens (60 years and above), aimed at providing a regular income after retirement. Operated by the Life Insurance Corporation (LIC) of India, it ensures a steady monthly payout, which can also be received quarterly, semi-annually, or annually, depending on the individual’s preference.
Why PMVVY Stands Out
PMVVY is highly beneficial for retirees looking for a guaranteed income stream with little to no risk. Although the scheme doesn’t offer tax-free interest, its steady returns and government backing make it an attractive choice for low-risk income. The scheme is also flexible, with options for loan facilities after three years of holding.
Example: Kamal, a retired government employee, invested a portion of his savings into PMVVY to receive a monthly pension alongside his other retirement benefits, ensuring a comfortable lifestyle.
FAQs on Saving Schemes
Which saving scheme offers the best interest rate?
- Sukanya Samriddhi Yojana and Senior Citizens Saving Scheme generally offer higher rates.
- Can NRIs invest in these schemes?
- NRIs are generally restricted, though options like RBI Bonds and some bank FDs may be open.
- Which scheme has the longest lock-in period?
- The PPF has a 15-year lock-in period, but can be extended.
- Is the interest on saving schemes taxable?
- Some, like the PPF, have tax-free interest, but many are taxable based on specific terms.
- What’s the best scheme for retirement?
- For retirees, the SCSS and APY are tailored for retirement needs.
- Are these schemes risk-free?
- Government-backed schemes like PPF and NSC are highly secure; others may have slight variations based on terms.
Conclusion
Choosing the right savings scheme can make a significant difference in achieving your financial goals, whether you’re saving for retirement, education, or daily expenses. The schemes listed here provide a range of options that balance safety, tax benefits, and return potential. To secure a bright financial future, consider your specific needs and choose accordingly. Each scheme has something unique to offer—your perfect fit is just a choice away!