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For Indian savers, choosing the right long-term investment often comes down to balancing safety, tax benefits and returns. Two of the most popular options are the Sukanya Samriddhi Yojana (SSY) and Systematic Investment Plans (SIPs) in mutual funds. But if you set aside Rs 1.1 lakh over 15 years, which one gives you more?

The SSY is a government-backed savings scheme created for the benefit of girl children. It currently offers 8.2% annual interest, compounded yearly. Parents or guardians of girls under 10 years can open the account, with deposits ranging from Rs 250 to Rs 1.5 lakh a year. The scheme also comes with tax benefits under Section 80C, and both the interest and maturity value are tax-free.

If Rs 1.1 lakh is invested as a lump sum and left untouched, the value after 15 years could reach about Rs 3.56 lakh. The catch is that the scheme is limited to families with girl children and withdrawals are allowed only under specific conditions.

SIPs allow investors to put in small sums at regular intervals in mutual funds. The returns depend on market performance, usually falling between 10% and 15% annually over the long run.

Assuming a return of 12% per year, an SIP investment of Rs 1.1 lakh spread over 15 years can grow to nearly Rs 4.4 lakh. SIPs are open to everyone and provide flexibility, but unlike SSY, they do not offer guaranteed returns.

SSY is a safe option for those seeking guaranteed growth and tax savings, especially parents planning for a daughter’s future. SIPs, on the other hand, are better suited to investors who are willing to take some risk in exchange for higher potential returns and more flexibility.

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