8 best government investment schemes in India 2022

8 best government investment schemes in India 2022

Many investors want to ensure investments with skyrocketing returns at the earliest without the risk of loss of principal amount. They are looking for an investment plan to double the overall investment with minimum or no risk.

8 best government investment schemes in India 2022

Unfortunately, the combination of low risk and high returns is not possible in a real-life scenario. Based on reality, returns and risk are directly proportional to each other – go hand in hand. This implies that the higher the return, the higher the overall risk, and vice versa.

When you are choosing the investment path before you invest
You need to know the risks involved in the given product at your own risk. You may come across some investments with high risk.

Today we will tell you about the 8 best government investment schemes in India, which provide good returns along with less risk.

Table of Content

  1. Sukanya Samriddhi Yojana (SSY)
  2. National Pension Scheme (NPS)
  3. Public Provident Fund (PPF)
  4. National Savings Certificate (NSC)
  5. Atal Pension Yojana (APY)
  6. Pradhan Mantri Jan Dhan Yojana (PMJDY)
  7. PMVVY or Prime Minister Vaya Vandana Yojana
  8. sovereign gold bond

1- Sukanya Samriddhi Yojana (SSY)

Sukanya Samriddhi Yojana schemes are secure the future of their daughters. It was launched in the year 2015 by the Prime Minister of India Narendra Modi under the campaign ‘Beti Bachao, Beti Padhao’.

  • This scheme is mainly for minor girl children. SSY account can be opened in the name of the girl at any time from her birth till she attains the age of 10 years.
  • The minimum investment amount for this scheme is INR 1,000 with a maximum of INR 1.5 Lakh per annum. Sukanya Samriddhi Yojana is applicable for 21 years from the date of opening.

2- National Pension Scheme (NPS)

NPS is one of the very famous schemes. The Retirement Savings Scheme is open to all Indians but is mandatory for all government employees.

  • Its objective is to provide retirement income to the citizens of India. Indian citizens and NRIs in the age group of 18 to 60 years can subscribe to this scheme.
  • Under the NPS scheme, you can allocate your funds in equities, corporate such as bonds, and government securities.
  • Investment up to Rs 50,000 can be deducted under section 80CCD(1B). There are additional investment taxes up to INR 1,50,000.

3- Public Provident Fund (PPF)

PPF is one of the oldest retirement schemes launched by the Government of India. The amount invested, the interest earned and the amount withdrawn are all tax-free.

This way Public Provident Fund is not only safe but can help you save on taxes at the same time. The current interest rate of the scheme (FY 2020-21) is 7.1% per annum.

  • Tax deduction – up to Rs 1,50,000 claimed under Section 80C of the Income Tax Act.
  • This fund has a longer tenure of 15 years, the overall effect of which is compound interest which is tax-free, becomes significant, especially during the later years.
  • Apart from earning interest and the principal invested being the respective sovereign guarantee, it is known as a safe investment.

4- National Savings Certificate (NSC)

National Savings Certificate was started by the Government of India to promote saving money.

  • Its minimum investment amount is INR 100, which every individual can afford, and the interest rate NSC changes every year.
  • The interest rate is 6.8% compounded annually, but it is payable on maturity, and one can claim tax.
  • Deduction- Rs 1.5 lakh under section 80C. Only residents of India can take advantage of this scheme.

5- Atal Pension Yojana (APY)

APY is a social security scheme launched by the Government of India for workers.

  • An Indian citizen in 18-40 years is eligible to apply for the bank account scheme.
  • It is encouraging weaker section persons to opt for pension which will benefit them during their old age.
  • Any self-employed person can also take this scheme. One can enroll for APY at your bank or post office.
  • However, there is only one condition in this scheme that the contribution made till the age of 60 years.

6- Pradhan Mantri Jan Dhan Yojana (PMJDY)

Pradhan Mantri Jan Dhan Yojana was launched to provide basic banking services like Savings Account, Deposit Account, Insurance, Pension, etc.

  • The Government of India aims to provide easy access to financial services like Savings and Deposit Accounts, Remittances, Insurance, Credit, Pension to the poor and needy section of our society.
  • The age limit for this scheme is 10 years. Otherwise, being above 18 years of age is still eligible to open the account.
  • A person can exit from this scheme only after attaining the age of 60 years.

7- PMVVY or Prime Minister Vaya Vandana Yojana

This investment plan is applicable for above 60 years of age.

  • It is known to offer them a guaranteed return of around 7.4 percent per annum. The plan provides access to a pension plan payable on a monthly, yearly, and quarterly basis. 
  • The minimum amount received as a pension is INR 1000.

8- Sovereign gold bond

Sovereign Gold Bond was launched in November 2015. Its purpose is to offer an attractive option to hold and save gold.

  • This scheme is considered to be the category of Debt Funds. It helps in tracking the overall import-export value of the given asset but also helps in ensuring transparency.
  • SGBs refer to government-based securities. Therefore, they are considered completely safe. 
  • The respective value is denominated in several grams of gold. Since it is the safest alternative to physical gold, SGB has seen immense popularity among investors.

FAQ/Frequently Asked Questions

Q.1- What are the benefits of investing in government savings schemes?

A: Apart from enjoying tax benefits under Section 80C of the Income Tax Act of 1961, you can also enjoy excellent returns by investing in a government savings scheme.

Generally, the returns offered by government savings schemes” best government investment schemes in India” are higher as compared to your regular fixed deposits.

Q.2- Do government savings schemes have a lock-in period?

Yes, the lock-in period of most of the government savings schemes is higher than that of regular fixed deposits.

For example, the Senior Citizens Savings Scheme has a lock-in period of 5 years. After which tenure extended for another 3 years.

Q.3- Can Public Provident Fund be considered as a savings scheme?

A: Yes, PPF is a savings scheme offered by the government for 18 to 60 years citizens.

Anyone participating in this scheme can earn an interest of 7.1% per annum. It is the oldest and most successful savings scheme run by the government.

Q.4- What is Atal Pension Yojana?

It is a pension scheme that applies only to workers in the unorganized sector. Under this scheme, workers with bank accounts in the age group of 18 to 40 years can avail pension in old age. This scheme encourages the workers.

 Q.5- Can I get tax benefits under these schemes?

A: Yes, most of these schemes are covered under Section 80C of the Income Tax Act of 1961, and you can enjoy tax benefits.

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