In today’s changing economy, everyone is looking for a safe investment. Many times, we consider investing money in instruments like a bank or a mutual fund, but back off due to fear of risk. In such a situation, the savings schemes of the Indian Post Office can prove to be a great option for the people. The specialty of these schemes is that not only are better interest rates available here, but tax benefits can also be availed. Also, it is considered a completely risk-free investment.
From Post Office Savings Account to Public Provident Fund (PPF) and Kisan Vikas Patra, schemes ensure your financial security for a long time. Let us know about the major savings schemes of the post office in detail.
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Post Office Savings Account
This account works exactly like a bank savings account. The only difference is that it has to be opened by going to the post office. A minor can also open an account under this scheme. Currently, interest is given on it at the rate of 4 percent. This scheme is better for those who want to keep small savings safe.
Post Office Monthly Income Scheme (MIS)
If you want a fixed income every month, then this scheme is a better option for you. Its duration is 5 years. In this, interest is received every month at the rate of 7.4 percent per annum. A maximum of Rs 9 lakh can be invested in a single account and up to Rs 15 lakh in a joint account. The facility of premature closure of the account after one year is also available; however, a penalty of 2 percent has to be paid for closing the account between 1 to 3 years, and up to 1 percent after 3 years.
Post Office Recurring Deposit (RD)
This scheme is ideal for small investors. A minimum of Rs 100 can be deposited in it every month, and there is no maximum limit of investment. This scheme offers an interest rate of 6.7 percent for a period of five years. If the deposit is not made in any month, a penalty of Rs 1 has to be paid for every Rs 100. After one year, the investor can withdraw up to 50 percent of their deposit amount.
Post Office Time Deposit
This scheme is like a bank’s fixed deposit. An account can be opened with a minimum of Rs 1000. Interest is given according to the period. One gets the benefit of 6.9 percent interest on one year, 7.0 percent on two years, 7.1 percent on three years, and 7.5 percent on five years. This account can also be transferred to any post office across the country.
Senior Citizen Savings Scheme (SCSS)
This scheme is specially designed for senior citizens. People above 50 years of age can invest in it. A joint account can be opened in the name of an individual or a couple. A maximum of Rs 15 lakh can be invested. The maturity period of this scheme is 5 years. This scheme is a good means of a regular income after retirement.
Kisan Vikas Patra (KVP)
This is a very popular scheme for rural and urban investors. It gives 7.5 percent annual compound interest, and the investment amount doubles in about 115 months. Investment can be started with a minimum of Rs 100,0 and there is no limit on the maximum amount.
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Public Provident Fund (PPF)
This scheme is suitable for long-term investors. It gives 7.1 percent interest for a period of 15 years. Investors can open an account with Rs 500, and opening a joint account is not allowed in it. This scheme also offers tax benefits and is considered suitable for creating a retirement fund.