Post Office RD is ideal for investors looking to turn their small savings into solid capital. This scheme offers an excellent blend of security and good returns. Under this scheme, your total investment over 5 years will be ₹15 lakh (₹25,000 per month). However, thanks to a monthly compounding interest rate of 6.5%, you’ll earn an additional ₹2.74 lakh in interest, resulting in a total of ₹17,74,000 after 5 years.
This scheme is exceptional because it’s fully backed by a government guarantee, which means your money is always safe. There’s no worry about market risks.
RD Account Opening Rules and Unique Features
The most important feature of Post Office RD is that you can start monthly deposits with a minimum of ₹100, and there’s no maximum limit. You can deposit as much as you want.
You can open this account individually (as an individual) or jointly (two or three individuals). Deposits can be made through cash or check, as per your convenience. In the unfortunate event of the account holder’s death, the deposit is transferred to the legal heirs, simplifying the process.
Regularity is Important
Investing in this scheme is mandatory on a fixed date every month. If you fail to make timely deposits, you have to pay a small penalty. However, despite this requirement, the scheme remains highly attractive to investors due to its safety and reliability.
Withdrawal after 5 Years
After the 5-year term is over, you can withdraw your entire deposit (including interest). However, if you wish to extend your savings further, you can extend the scheme for another five years. This will ensure compound interest continues to accrue on your capital and further strengthen your financial goals.
Loan Facility in Need
The Post Office RD also offers a unique facility for account holders. After successfully paying 12 monthly installments, you can also take a loan against your RD account balance. You can avail up to 50 percent of your deposit as a loan. This loan is repaid with interest, which gives this scheme flexibility so it can be used in emergencies.
The Post Office’s extensive network across the country and reliable processes make it extremely popular among investors, both ordinary and elite. This scheme is a simple and effective way to convert your small savings into solid capital, which can help you reach a better financial position within five years.