Saving for a child's future is usually a long-term exercise. For parents of a girl child, the Sukanya Samriddhi Yojana (SSY) is one of the government-backed options designed specifically for this purpose.
At an interest rate of 8.2% per annum for the October-December 2026 quarter, regular contributions to an SSY account can potentially build a corpus of around Rs 71.8 lakh, assuming the interest rate remains unchanged throughout the investment period.
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At first, that sounds like a substantial amount. But there is another number parents need to keep in mind: inflation.
Rs 71.8 lakh received two decades from now will not have the same purchasing power as Rs 71.8 lakh today. So, before deciding whether SSY alone is enough to fund a daughter's higher education or other future expenses, it is important to understand both the returns and the impact of rising prices.
How Does Rs 1.5 Lakh A Year Grow To Rs 71.8 Lakh?
Under SSY rules, parents or legal guardians can deposit up to Rs 1.5 lakh in a financial year into the account.
The account allows deposits for 15 years, while the account matures after 21 years from the date of opening.
If a parent invests the maximum Rs 1.5 lakh every year for 15 years, the total amount deposited would be:
Rs 1.5 lakh × 15 years = Rs 22.5 lakh
The remaining amount in the projected maturity corpus comes from the interest earned and the power of compounding.
Assuming an interest rate of 8.2% throughout the period, the corpus can grow to approximately Rs 71.8 lakh by maturity.
However, there is an important caveat: 8.2% should not be treated as a guaranteed rate for the entire 21-year period. The SSY interest rate is reviewed and notified by the government periodically.
Therefore, the actual maturity amount could be higher or lower depending on the rates applicable over the years.
Why Inflation Matters When Looking At Rs 71.8 Lakh
This is where the headline maturity figure can become misleading.
Imagine a parent opens an SSY account when their daughter is very young and the account matures 21 years later. By then, the cost of education, accommodation, healthcare and everyday living is likely to be significantly higher than it is today.
For example, assuming an average inflation rate of 6% a year, Rs 71.8 lakh received after 21 years would have a purchasing power equivalent to roughly Rs 21 lakh in today's money.
In other words, the amount does not disappear. Its purchasing power declines as prices rise.
This is particularly important when SSY is being considered for long-term goals such as higher education. A college course that costs Rs 10 lakh today could cost considerably more two decades from now.
What Parents Should Keep In Mind
The biggest attraction of SSY is the discipline it brings to long-term saving. A parent who consistently invests up to Rs 1.5 lakh a year for 15 years can create a meaningful corpus without having to make additional deposits for the remaining years until maturity.
But the Rs 71.8 lakh figure should be viewed as an illustration, not a guaranteed outcome. It assumes the interest rate remains at 8.2% throughout the relevant period, whereas SSY rates can change.
Parents should also remember that the maximum annual contribution is Rs 1.5 lakh. If education costs rise faster than expected, this corpus may not be sufficient on its own.
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