Post Office is running various savings schemes for everyone, whether children, elderly, youth or women. The special thing is that although these investments offer strong returns, the government itself guarantees the safety of the investors’ money. Even small investments in these schemes can earn considerable profits. One such promising scheme is the Post Office Time Deposit Scheme, which can earn more than Rs 4 lakh in interest alone.

Safe Money and Strong Returns

People often plan to save a part of their income and invest it in places that will ensure safe money and provide excellent returns. Along with the huge interest, there are many other great benefits as well. The government offers an interest rate of 7.5% on investment for 5 years (PO TD interest rate). As the name of this scheme suggests, investments can be made for different tenures and the interest rate earned on the investment varies.

  • An investment for one year earns an interest of 6.9%.
  • An investment for two years earns 7% interest.
  • An investment for three years earns 7.1% interest.
  • An investment for five years earns 7.5% interest.
  • An account can be opened with a minimum of Rs 1,000.
  • The interest on the investment is compounded annually.

How can you earn Rs 4.5 lakh from interest?

The Post Office Time Deposit Scheme is considered one of the most effective government schemes in the list of Post Office Savings Schemes. This is because it offers strong interest rates, guaranteed income and tax exemptions. If you calculate the potential of earning Rs 4.5 lakh from interest alone through this investment, it is easy to understand.

You can increase or decrease the investment, and the interest income will also increase or decrease accordingly. For example, if an investor invests Rs 5 lakh for five years, he will get an interest of Rs 224,974, and the total maturity amount will be Rs 724,974. This scheme is so popular because it can earn lakhs from interest alone.

Post Office Time Deposit Scheme also offers tax deduction under Section 80C of the Income Tax Act, 1961.