Post Office FD Scheme: The Post Office offers several safe and profitable savings schemes for investors. Some of these schemes offer better returns than banks. One such scheme is the Post Office Time Deposit Scheme, commonly known as the Post Office FD scheme.

Under this scheme, investors can open FDs for periods ranging from one to five years and earn returns at a fixed interest rate. If invested correctly, the amount invested in this scheme can more than double.

Read Here: Good News for Middle-Class Families – Get a ₹2 Lakh Insurance Cover for just ₹436

How much interest do you get in a Post Office FD?

The interest rate offered on the Post Office Time Deposit Scheme depends on the FD tenure. For a one-year FD, investors get interest at a rate of 6.9 percent. For a two-year FD, the rate is fixed at 7 percent. A three-year FD yields a return of 7.1 percent. If an investor chooses a five-year FD, they get interest at a rate of 7.5 percent, which is the highest in this scheme.

What to do to get more than double returns?

If you want to get double or more returns from a Post Office FD, the five-year FD is considered the best option. It not only offers the highest interest rate but also provides tax benefits. The real benefit comes when the entire amount received after maturity is reinvested in the same scheme.

How your money will grow

If you invest ₹5 lakh in a five-year Post Office FD, according to the current interest rate, you will receive approximately ₹2,24,974 as interest after five years. Thus, the total amount at maturity will be approximately ₹7,24,974.

Read Here: This 20 Rupee Note Could Fetch You 12 Lakh Rupees, Find Out How

If you reinvest this entire amount in an FD for another five years, after ten years, you will receive a total of approximately ₹5,51,175 as interest. This means that with an investment of ₹5 lakh, your total amount could be approximately ₹10,51,175 after ten years. In this way, your money more than doubles.

Important information regarding extensions

If you wish to extend your Fixed Deposit (FD), this information can be provided at the time of opening the account. Additionally, for three-year and five-year FDs, it is necessary to apply for an extension within 18 months of maturity. The FD can only be extended if the request is submitted within the stipulated time frame.