SIP vs SSY vs EPF: Comprehensive comparison of Rs 12,000 monthly investment returns, benefits and tax savings
Compare Sukanya Samriddhi Yojana (SSY), EPF, and SIP based on monthly investments. Discover the returns on a Rs 12,000 investment in each scheme and determine the best long-term savings plan.
ZeeBiz WebTeam | Sep 27, 2024, 01:54 PM IST
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Sukanya Samriddhi Yojana (SSY) Overview
- Launch Year: 2015, as part of the "Beti Bachao, Beti Padhao" initiative.
- Interest Rate: 8.2% p.a.
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Eligibility
- Girl child under 10 years.
- One account per child.
- Max of 2 accounts per family.
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SSY Returns on Rs 12,000 Monthly Investment
- Total Investment: Rs 21,60,000
- Interest Earned: Rs 44,90,475
- Maturity Value: Rs 66,50,475
- Tax Benefits: SSY offers tax deductions under Section 80C of the Income Tax Act.
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Employees’ Provident Fund (EPF) Overview
- Interest Rate: 8.15% p.a.
- Contribution: Both employee and employer contribute 12% of the employee's basic salary and dearness allowance.
- Tax-Free Interest: Withdrawals and interest accrued are tax-free under specific conditions.
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EPF Returns on Rs 12,000 Monthly Investment
Total Accumulation: Rs 48,93,132 upon retirement.
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EPF Schemes Offered:
- EPF Scheme 1952
- Employees' Pension Scheme (EPS) 1995
- Employees' Deposit Linked Insurance Scheme (EDLI) 1976
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Primary Objectives of EPFO
- Simplify compliance.
- Ensure dependability of online services.
- Reduce claim settlement time to 3 days.
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Systematic Investment Plan (SIP) Overview
Investment Type: Regular investments into mutual funds, offering higher returns through market-linked growth.
Method: Fixed investment at set intervals, automatically debited from your bank account.
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SIP Returns on Rs 12,000 Monthly Investment
- Total Investment: Rs 21,60,000
- Estimated Returns: Rs 38,94,912
- Total Value: Rs 60,54,912
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Key Benefits of SIP
- Flexibility in investment intervals.
- Higher potential returns due to compounding.
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Comparing Returns on Rs 12,000 Monthly Investment
- SSY Maturity Value: Rs 66,50,475
- EPF Accumulation: Rs 48,93,132
- SIP Estimated Value: Rs 60,54,912
For long-term savings, SSY offers the highest maturity value, while SIP provides flexibility and potential market-driven growth. EPF is ideal for salaried employees aiming for retirement benefits with tax advantages.