Best Saving Plans - Top 10 Savings Plans in India 2023

By Okbima 01 May 2023
Best Saving Plans in India

 

Looking for the Best Savings Plans In India 2023 is a relatively long process.  And we all want to grow our wealth which helps in the well-being of ourselves and our family. In this fast-moving space, it’s necessary to save funds for emergencies or to secure your retirement. What you can do to increase your wealth safely is put the money in the best investment options in India. There are some best saving schemes in India that is offered by the government, financial companies, and banks where you can invest and earn high returns. In this blog, I mentioned some of the best investment options in India 2023 that will help you to make a plan. Let’s get into it.

 

What are Saving Plans? 

Savings plans in India are investment choices that can help you safely grow your money and achieve your financial objectives. The most excellent savings plans will allow you to engage for a long time and swiftly convert your resources into investments. These programs enable you to invest a regular portion of your money, even in small sums.


Top 3 Benefits of Savings Plan

A savings plan offers financial security, future goal attainment, and peace of mind. Here I have described some of the top 3 benefits that you can check out below:


1. Financial Protection 
A saving plan can help you to manage your family finances and prevent unexpected expenses. Having a savings plan will give you confidence in emergencies or additional costs. With this, you can also plan your future and invest for retirement. 

2. Tax Savings
As of now, you have to pay taxes on some of your investments, but with a savings plan, you can reduce or even eliminate these taxes under Section 80C of The Income Tax Act, of 1961.

3. Retirement Planning
Whether you are working full-time, part-time, or self-employed, having a retirement plan is essential for everyone. It helps you to track your income and expenses, which you can use to save for your retirement.

 

Factors to consider before investing in a Savings Plan

Before investing in a savings plan, it's crucial to evaluate your financial goals, risk tolerance, time horizon, and the plan's terms to make informed decisions that align with your objectives.

Goals: You should set a certain goal before investing in a savings plan. It can be going on a dream vacation, buying an expensive car, making the down payment for a house, funding your child’s higher education, or planning for your retirement.

Risk: It is necessary to know your risk-taking ability. Your risk appetite can vary because of your age, life stage, income, and goals. For high returns, you have to take high risks. So, understand your risk appetite.

Flexibility: Look for a savings plan that allows you to withdraw money in case of a financial emergency. Many plans offer you the flexibility to choose the premium payment frequency and the payout methods as per your requirements. 

Plan Features: Explore different plans with different features and how much benefit you will get from them. Choose a plan that offers you flexible premium payment options, free withdrawal, additional benefits on online purchasing, etc. 


Top 10 Savings Plans in India 2023 

In 2023, India offers a diverse range of savings plans catering to various financial needs. This list presents the best savings plans for Indian investors to consider:

1. National Savings Certificate 

The National Savings Certificate (NSC) is a low-risk and fixed-income savings plan that you can open with any post office in India. It is backed by the Government Of India, mainly for the small or mid–income categories while saving income tax on it. You can open this scheme by visiting the nearest post office. 
 

Minimum Age

No age limit

Lock-in Period

5 years

Tax Savings

Up to Rs. 1.5 lakh under Section 80C

Interest

7.7% 

Minimum Investment

Rs. 1000

Premature withdrawal

Not Possible.

Documents

PAN card/Senior Citizen ID, Photograph, Electricity bill/Bank Statement.

Note- Anyone can invest in an NSC savings plan, except HUFs (Hindu Undivided Families), trusts, and non-resident Indians.

 

2. Senior Citizen Savings Scheme (SCSS)

The Senior Citizen Savings Scheme offers you a very safe, tax saving and a regular income plan. What makes the best scheme is that it gives you safety and minimizes taxes. You can open this by visiting the nearest post offices and certified banks across India. And you can open this scheme via cash or cheque.
 

Minimum Age

Individual above 60 years. Retired people above 55 years and below 60 years

Maturity

5 years and can be extended for more 3 years.

Tax Savings

Upto Rs. 1.5 lakh under Section 80C.

Interest

8.20%

Minimum Investment

Rs. 1000

Maximum Investment

Rs. 30 lakhs 

Premature withdrawal

Allowed.

Penalty

If you close the account within one year but before two years, 1.5% of your deposited money is deducted as a fee. If you close it after two years, 1% is deducted as a fee.

Nominee

Can be added by submitting an application form.

Documents

Two photographs, PAN/Voter/Aadhar.

 

3. Recurring Deposit (RD)

If you are looking for an investment in which you can make regular deposits, and decide the amount and number of monthly deposits, then this is the best scheme that is offered by banks. This is the best savings plan for senior citizens, as they can earn a higher rate of interest. And can also use RD as collateral for taking loans. 

 

Minimum Age

18 years. 

Maturity

6 months-10 years.

Tax Savings

Taxable

Interest

For banks, it depends on market situations, For the post office, you will get between 5.8% to 6.8%

Minimum Investment

Rs. 100.

Premature withdrawal

Not allowed. However, some banks allow early withdrawal with a penalty.

Documents

Two photographs, PAN/Voter/Aadhar. 

 

4. Post Office Monthly Income Scheme (MIS)

If you are looking for an investment where you can earn monthly interest on your investment, then post office monthly income scheme is the best savings plan for you which is offered by the post office. This is a low-risk and steady income-generating plan and your invested money will be completely safe.  After, completing the maturity period, you can either withdraw the amount or again invest in the scheme and only Indian Citizens can invest in this scheme. 

 

Minimum Age

18 years. 

Maturity

5 years.

Tax Savings

Taxable

Interest

7.4%

Minimum Investment

Rs. 1000.

Maximum Investment

Rs. 9 lakh for a single account. Rs. 15 lakh for joint account.

Premature withdrawal

In case of premature withdrawal between 1 to 3 years of account opening, a 2% `deduction on deposit is applicable

Minor

Any minor above 10 years of age can open this account.

Documents

Two photographs, PAN/Voter/Aadhar.

 

5. Kisan Vikas Patra (KVP)

This plan is offered by the Indian Post Office and doubles the money that is invested in a period of 100 months (eight years and four months). However, this plan is only open for farmers to encourage long-term savings. But with the advantage of this, Now, it’s available for everyone. You can buy or open a Kisan Vikas Patra certificate from the nearest post office and you will get guaranteed returns without any market fluctuations.  Also, you can use KVP certificates as collateral to take loans.

 

Note- To prevent money laundering, the Indian Government has made it compulsory to provide PAN card proof for investments above Rs. 50,000. To invest more than Rs. 10,00,000, you have to provide income proof, and submitting Aadhar for identity proof is also mandatory.

 

Maturity

9 years 7 months (115 months).

Tax Savings

Taxable. However, TDS is exempt from the withdrawals after the maturity period.

Interest

7.5%

Minimum Investment

Rs. 1000

Premature withdrawal

Allowed. After 2 years and 6 months from the date of issuance

Documents

Two photographs, PAN/Voter/Aadhar.

 

6. Public Provident Fund (PPF)

It is the most popular savings option in India, as it is backed by the Government Of India. In case of a location change, you can easily transfer your PPF account to the new post office.

 

Minimum Age

No minimum age limit.

Maturity

15 years.

Tax Savings

Taxable under section 80C.

Interest

7.1%

Minimum Investment

Rs. 500

Maximum Investment

Upto maximum Rs. 1.5 lakhs in a financial year.

Premature withdrawal

Possible only from the 7th year of making the investment

Documents

Two photographs, PAN/Voter/Aadhar.

 

7. Sukanya Samriddhi Yojana (SSY)

Sukanya Samriddhi Yojana is ofered by the Indian Ministry of Finance. It is the best scheme to secure the financial future of your girl child. In case of a location change, you can easily transfer to the new post office. There are Some of the features and benefits which you can see below:

 

Minimum Age

Can be open between the birth of the girl child and the age of 10 years.

Maturity

Till the age of 21 years.

Tax Savings

Exemptions up to Rs. 1.5 lakh under Section 80C.

Interest

8.0%

Minimum Investment

Rs. 250

Maximum Investment

Upto Rs. 1.5 lakhs in a financial year.

Premature withdrawal

can withdraw up to 50% of the total savings for fulfilling the purpose of marriage or higher education of his/her girl child.

Documents

Birth certificate, photograph of the parents, Aadhar/PAN Card

 

8. Atal Pension Yojana (APY)

This scheme is specially designed for the welfare of the weaker section of society. If anyone works in the unorganized sectors (labor, daily wage earners) and requires financial support from the government, then this is the best scheme for them. You can enjoy your retirement life by paying a very low premium in this scheme and it’s necessary to have an active savings bank account.

 

Age

Between the age of 18-40 years.

Maturity

Minimum 20 years.

Tax Savings

Taxable

Interest

N/A

 

9. Employee Provident Fund (EPF)

This scheme is initiated by the government and introduced by the EPFO (Employee Provident Fund Organisation) and it’s mandatory for salaried individuals to make an equal financial contribution towards the PF account. Having an EPF fund will help you to plan your retirement in advance so, you can enjoy your retirement stress-free.

 

Interest

8%-12%.

Contribution

The employee and employers make an equal contribution of 12% of the employee’s monthly salary towards the PF account per month.

 

10. Pradhan Mantri Jan Dhan Yojana (PMJDY)

Pradhan Mantri Jan Dhan Yojana was launched by the Government Of India in the year 2014, especially for those who do not have a bank account in India. It offers cost-effective financial services such as remittance, banking, pension, insurance, etc.

 

Minimum Age

18 years or can be open as a minor.

Minimum Balance

Zero Balance

Cover

Life cover of Rs. 30,000 and accidental cover of Rs. 1 lakh.

Documents

Aadhar/PAN Card, a photo, signature.


 

Who should invest in a Savings Plan? 

Savings plans are ideal for anyone looking to secure their financial future, build wealth, or achieve specific goals. Whether you're young or nearing retirement, a savings plan is a wise choice.

  1. Any individual of all age groups up to 60 years can invest in a savings plan.

  2. Any Income group can invest. These plans offer affordable premiums. 

  3. Best for those looking a low-risk investment options.

  4. Suitable for those who want to save for unexpected expenses.

 

Conclusion

In a conclusion , you can explore the Best Savings Plans in India 2023, as per your requirements. Every scheme is the best for a certain situations and requirements and it’s up to you enjoy the benefits. Also, there is no concern about the minimum or maximum investments, because you can invest as per low as Rs. 100. So, build your future better.

 

Frequently Asked Questions 

 

What are small saving schemes?

Small savings schemes, promoted by the Government of India, encourage savings, aiding individuals with modest incomes to grow wealth, with no TDS deductions.

 

Which saving scheme is best for senior citizens?

SCSS and PPF stand out as top saving schemes for 60+ investors. SCSS permits lump sum investments up to Rs. 15 lakhs for retirees aged 55, ensuring safe returns and tax savings.

 

Can NSC be transferred?

Yes, most savings schemes are transferable including NSC. It's possible to transfer your NSC account to any bank or post office in India, except when it has matured.

 

What is an Employee Saving Plan?

Employers provide saving plans for their staff to invest a portion of their income toward both short and long-term goals.

 

Is the interest rate fixed for saving schemes?

No, the interest rate may change from time to time for these schemes. Usually, the government updates the interest rate every 3 to 6 months.

 

Which are the top 5 small savings schemes available in India?

Here are the top 5 popular small saving schemes available in India: Sukanya Samriddhi Yojana, Public Provident Fund, Post-Office Monthly Income Scheme, Senior Citizen Savings Scheme, National Savings Certificate.

 

Why is the Savings Plan important?

Consistent saving prepares individuals for unexpected events, fulfills short and long-term financial goals, and provides a secure retirement. Discipline builds a stress-free financial cushion.

 

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