Post Office Scheme: In today’s times, when the stock market is constantly fluctuating, investing in mutual funds has become a source of worry for many. The middle class, in particular, often wonders if there is an investment option where their money is completely safe and also grows into a substantial fund over time. In such a scenario, the Post Office Recurring Deposit (RD) scheme can prove beneficial, and in many cases, it is considered even more robust than bank Fixed Deposits (FDs) today. With proper planning, a large fund can be created over the long term by investing in this scheme.

Schemes are trustworthy for people

Post office savings schemes are directly supported by the government. There is no risk of losing money or fraud. Interest rates are determined every three months, and the entire process is transparent. Investors receive a fixed return at the stipulated time, making future planning easier. This is why the Post Office remains the first choice for people when it comes to safe investments.

What is the Post Office RD Scheme?

A recurring deposit is a scheme designed for people who cannot invest a large sum of money at once. In this scheme, small amounts are saved every month from salary or income. Upon completion of the fixed period, the deposited amount, along with interest, transforms into a substantial sum. This scheme helps in gradually building a strong fund without any risk.

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Key features of Post Office RD

A Post Office RD account can be started with just Rs 100 per month, and there is no limit on the maximum investment. Currently, it offers an annual interest rate of approximately 6.7 percent, which comes with a complete government guarantee. The initial tenure is 5 years, which can be extended for another 5 years. If needed, half of the deposited amount can be taken as a loan after one year.

Accounts can be opened in the name of children

It is worth noting that a major feature of the Post Office RD is its flexibility. Besides a single account, a joint account can be opened in the name of a husband and wife. The scheme also allows for opening an account in the name of a minor child with a guardian. This is why this scheme is considered useful for the entire family.

Build a large fund in 10 years

If a person deposits ₹25,000 every month in a Post Office RD and extends the scheme after 5 years, the total investment period becomes 10 years. During this time, small monthly savings, combined with interest, accumulate into a large amount. Maintaining the investment for a long period can result in a sum reaching lakhs of rupees.

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Post Office RD is better than FD

Most bank FDs have limited interest rates, and in many cases, there is also a tax burden. Additionally, FDs usually require a lump sum investment. On the other hand, the Post Office RD offers the convenience of investing every month, making it easier for salaried individuals to save. It also comes with a government guarantee, which makes it even more secure.

A husband and wife can build a strong fund together

If a husband and wife open a joint RD account and both contribute monthly, the burden of saving doesn’t fall on just one person. For example, if both deposit ₹12,500 each, the total monthly investment becomes ₹25,000. This strengthens the habit of saving and makes it easier to prepare for major future goals such as buying a house, children’s education, or retirement.

How to start investing

To start, simply visit your nearest post office, open an RD account, and decide how much you can comfortably deposit every month. Don’t forget to extend the scheme after five years. Over time, your small savings will transform into a large and secure fund.

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