Post Office scheme – If you also want to get strong interest on your investment, then this news is for you. In fact, on investing five lakh rupees in this post office scheme, an interest of Rs 2.25 lakh is being received.
Post Office Time Deposit Scheme: Post Office runs several schemes of small saving schemes. If an investor wants to invest in fixed income schemes, then India Post Time Deposit Scheme is a great option. It is just like the fixed deposit of the bank.
However, money can be deposited in this only for four different tenures. POTD ie Post Office Time Deposit can be opened for 1 year, 2 years, 3 years and 5 years. Interest is calculated on a quarterly basis, but paid annually.
Interest is available up to 7.5 percent-
According to the information available on India Post’s website, there has been a change in the interest rate from April 1. Currently, 6.8 per cent interest is available on 1-year time deposit, 6.9 per cent on 2-year period, 7 per cent on 3-year period and 7.5 per cent on 5-year period. A minimum investment of Rs 1000 can be made. There is no maximum investment limit.
Interest of 2.25 lakhs on 5 lakhs-
Tax deduction is also available under section 80C of the Income Tax Act on time deposits of 5 years. According to the Post Office Calculator, if an investor deposits Rs 5 lakh in the Time Deposit Scheme for 5 years, then he will get a total of Rs 2 lakh 24 thousand 974 as interest. The annual average return called CAGR is 7.71 percent. After completion of five years, you will also get back the principal amount of Rs 5 lakh.
Why invest in Post Office Time Deposit?
1 – Post office time deposit account is similar to bank FD. In this, the revision of the interest rate is done on a quarterly basis. It can be opened for 1, 2, 3 and 5 years.
2 – It offers minimum interest of 6.8 per cent and maximum interest of 7.5 per cent. This is higher than the average returns of banks.
3 – Revision of interest bill is done on quarterly basis. The rate of bank FD depends on the repo rate of the Reserve Bank to a great extent. Every two months, the Reserve Bank takes a decision on the repo rate.
4 – Pre-mature closure of post office time deposit account can also be done.
5 – Post office time deposit account can also be extended within a fixed period. Apart from this, emergency fund can also be arranged by pledging it at the time of need.
