If you want to convert your small monthly savings into a large and secure fund, the Post Office Recurring Deposit Scheme can be an excellent option for you. This scheme is ideal for families who prefer regular savings while remaining risk-averse. Being backed by the government, investing in this scheme is considered completely safe.

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Why is Post Office RD considered the most reliable scheme?

In a recurring deposit scheme, investors deposit a fixed amount every month, which earns a fixed interest. Currently, this scheme offers an annual interest rate of 6.7 percent, which is higher than many private banks. Its reliability and stable returns make it an attractive option for the middle class.

Who can open a Post Office RD account?

Any individual can open a single or joint account under this scheme. The minimum deposit amount is ₹100, and there is no maximum limit. Accounts can also be opened in the name of children. After the five years are completed, there’s an option to extend it for another five years. Furthermore, after twelve installments have been deposited, investors can also avail of a loan of up to 50 percent of their deposit.

For whom is RD most beneficial?

This scheme is ideal for those who don’t have a lump sum available but want to make a fixed monthly saving. It’s also beneficial for families who want a completely safe investment and prefer government-guaranteed schemes. Opening a joint RD increases the pace of fund building.

How can a husband and wife build a large fund together?

If both have a stable income, opening a joint RD account can allow for a larger monthly deposit. When both couples contribute their savings, the total investment increases, and the interest earned is higher. This is why this method proves to be extremely effective in the long run.

How to Build a Fund of ₹30 Lakh in 10 Years

Assume that a husband and wife each contribute ₹9,000 each every month, totaling ₹18,000. The RD continues for the first five years, and then the account is extended for another five years. This investment continues for a total of ten years. During this period, a fund of approximately ₹30.75 lakh can be created. This includes an interest of approximately ₹9.15 lakh, which is earned without any risk.

Why is this plan considered the best?

The biggest advantage of this scheme is its security. Fixed interest is guaranteed by the government, and market fluctuations do not affect it. If a husband and wife invest together, the fund grows rapidly. Loan options are also available if needed. Therefore, this scheme emerges as a long-term and stable savings plan.

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What Common Mistakes People Make?

People often discontinue their RD after five years and do not take advantage of the extension. Many people don’t invest small savings regularly, preventing the fund from growing. Not using the facility of a joint account is also a common mistake.