Post Office Scheme: The continuous decline in interest rates on bank Fixed Deposits (FDs) is a growing concern for investors, especially those who prefer safe returns with minimal risk. Currently, many large public and private sector banks are offering only 6 to 7 percent interest, while Post Office Small Savings Schemes provide reliable returns ranging from 7 percent to 8.20 percent.
Why are Bank FDs becoming less attractive?
In recent times, many banks have reduced their FD interest rates. Previously, FDs were a safe investment option offering respectable returns; now, they seem to be limited to just protecting the principal amount. The likelihood of a significant increase in interest rates in the future is low. Therefore, ordinary investors are wondering where they can invest their money safely and still get better returns.
Government Guarantee Increases Confidence
The biggest advantage of Post Office Small Savings Schemes is the 100 percent government guarantee. Investors know that their money is completely safe. Additionally, many schemes offer tax benefits under the old tax regime. The government reviews interest rates every quarter, ensuring that returns remain balanced according to market conditions.
Which Scheme Offers How Much Interest?
The Senior Citizen Savings Scheme (SCSS) is the most popular among senior citizens, offering 8.2 percent interest. The Monthly Income Account is for those who need a stable monthly income, offering 7.4 percent interest. The National Savings Certificate (NSC) is a reliable tax-saving instrument with a 7.7 percent interest rate.
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The Public Provident Fund (PPF) offers tax-free returns in the long term with a 7.10 percent interest rate. The Kisan Vikas Patra (KVP) offers 7.5 percent interest and doubles the money in 115 months. The Mahila Samman Savings Certificate offers 7.5 percent interest, and the Sukanya Samriddhi Yojana offers 8.20 percent interest.
Time Deposit Options
A 2-year time deposit offers an interest rate of 7 percent, meaning an investment of ₹10,000 would yield approximately ₹719 in interest annually. A 3-year time deposit offers 7.1 percent interest, and a 5-year deposit offers 7.5 percent interest.
With these schemes, investors can secure their money while also earning higher returns than bank fixed deposits. These Post Office schemes are proving to be a reliable option for both long-term and small investors.