Is PPF better than SSY?

Education is the 4th basic need of human beings and the cost of which is skyrocketing these days. The inflation of the education sector is rising at a faster pace than any other sector.

The first step to proper education planning is Financial Planning! You can achieve your goal of giving your child the best education by effectively planning and managing your money. This blog will give you an insight into 2 popular investment options and help understand PPF vs. SSY.

Let’s first understand about PPF and SSY individually:

What is the Public Provident Fund (PPF)?

Public Provident Fund (PPF) is one of the long-term investment schemes backed by the Government.  It is also called a savings-cum-tax savings investment vehicle that enables one to build a corpus while saving on taxes.

Who can invest in PPF?

  • Any Indian citizen can open a PPF account either in his own name or on behalf of a minor.
  • One can’t open a joint account or one for a Hindu Undivided Family (HUF).
  • An individual can open only one account all across the country either in the Post Office or any Bank.

What is the Sukanya Samriddhi Yojana (SSY)?

SSY is a savings scheme launched back in 2015 as part of the Government initiative Beti Bachao, Beti Padhao campaign. SSY can be opened at any Commercial Bank or Post Office.

Who can invest in SSY?

SSY account can be opened by legal guardians of the girl child provided the following conditions are met:-

  1. The girl must be an Indian Resident.
  2. The girl should not be more than 10 years of age.
  3. Up to two accounts can be opened in a family with two girl children.
PPF Vs. Sukanya Samriddhi Yojana


*These interest rates are revised by the govt every quarter

Benefit of Sukanya Samriddhi Yojana and Public Provident Fund is:

  1. Both schemes fall under the EEE tax category i.e Investment – Exempt, Interest – Exempt, Withdrawal – Exempt
  2. Are Government-backed schemes
  3. Delivers safe and fixed interest

LXME Pro-Tip: Don’t put all your eggs in one basket. Always diversify your investments!

SSY and PPF do not deliver inflation-beating returns, however, they can offer stability to your portfolio. Besides, your portfolio also needs instruments that offer inflation-beating returns. So, where to invest to get these returns?

One of the options is the LXME Child Education Plan which is a mix of 70% equity & 30% debt which aims at a targeted return of 14% p.a.* (market-linked). This plan is diversified, well-researched, and curated by experts. You can start investing for both boy and girl child.

On the ending note, both the above mentioned investment options have their own pros and cons, so, before investing in any investment instrument you should first assess your goal, time horizon, and risk appetite. So, PPF or Sukanya which is better depends on your needs and goals.

Lastly, one should diversify their investment against different asset classes in order to get optimum returns along with managing risk.

*Mutual funds are subject to market risks, read scheme-related documents carefully.


Can NRIs invest in SSY and PPF?

No, NRIs cannot invest in SSY and PPF, only Indian citizens are eligible to invest in these schemes.

Can we extend the PPF investment after 15 years of maturity?

Yes, an investor can extend their PPF account after the 15-year maturity period in five-year blocks for an infinite number of times.

Is SSY interest taxable?

No, SSY falls under the EEE tax category where exemption is available during investment, interest received, and at the time of withdrawal.

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