Post Office Scheme: The Post Office RD scheme has become an easy way to build substantial savings even with a low income. With regular deposits of just ₹333 daily, one can build a safe corpus of over ₹17 lakh without any risk. This scheme is beneficial for investors of all ages.
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Post Office Scheme: People have always trusted the Post Office’s small savings schemes. These features, including safe investments, fixed interest rates, and government guarantees, have led millions to deposit a portion of their earnings. Meanwhile, the Recurring Deposit (RD) scheme is back in the news because even a small amount can generate significant savings.
Invest ₹333 daily to create a corpus of ₹1.7 million.
The uniqueness of RD is that it doesn’t require a significant amount. If someone saves approximately ₹333 daily and invests ₹10,000 per month in an RD, this amount can grow to over ₹1.7 million in 10 years with consistent investment. This means that small daily savings can become a significant financial asset.
6.7% interest and children’s names can also be used for accounts.
The Post Office currently offers an annual interest rate of 6.7% on RD accounts.
The scheme is so simple that an account can be opened in the name of a child above 10 years of age.
Updating KYC upon turning 18 can enable the child to continue operating the account in their own name.
Conveniently, RD accounts can also be opened through mobile banking and e-banking.
The term is 5 years, extendable to 10 years if desired.
The initial tenure of an RD is 5 years. Investors can extend this period by another 5 years, up to a total of 10 years. This makes it a stable and secure option for long-term savers.
It also offers several additional features, such as:
The option to close the account after three years
The right to claim the nominee upon the account holder’s death
A loan against the deposit amount after one year
What will be the total amount after investing for 10 years?
If ₹10,000 is deposited every month, the total deposit amount in the first 5 years will be ₹6 lakh. The interest for these 5 years will be approximately ₹1.13 lakh. If investors continue for the next 5 years, the total deposit amount will be ₹12 lakh. The total interest for the entire 10 years will be approximately ₹5.08 lakh. After that, the total maturity amount becomes ₹17,08,546.
A Beneficial Scheme for Investors with Small Amounts
Even if a person deposits only ₹5,000 every month, they can accumulate a corpus of approximately ₹8.54 lakh in 10 years. This means that this scheme is also suitable for those who want to save regularly with a small amount. A loan of up to 50% of the deposit amount is available on the RD account after one year. Only 2% additional interest is charged on the loan, which significantly reduces financial pressure in case of sudden need.
