You must have heard about many post office schemes. One special scheme is the Recurring Deposit (RD). In this scheme, you can build a fund of ₹11 lakh by saving just ₹222 daily. This scheme is guaranteed by the government, which means your money is completely safe.

How the Post Office RD Scheme Works

In the Post Office RD scheme, you deposit a fixed amount every month. If you save ₹222 every day, it becomes ₹6,660 per month. In 5 years, you will deposit a total of ₹3,99,600. On this amount, you get 6.7% annual interest, which is compounded every three months. This means you also earn interest on your interest.

After 5 years, you will get ₹4,75,297. If you extend this investment for another 5 years (a total of 10 years), your investment will become ₹7,99,200 and the total return will be ₹11,37,891. In this way, with just ₹222 daily, you can build a fund of ₹11 lakh.

The best thing about this scheme is that you do not need a big amount to start. You can begin with just ₹100 per month. Anyone can open this account – young, old, or even for a child. You can open it as a single or joint account. If you need money early, you can also close the account after 3 years.

Other Benefits of the Scheme

  1. After 1 year of deposits, you can take a loan up to 50% of your savings. Only 2% extra interest is charged on this loan.
  2. A nominee facility is available. If something happens to the account holder, the nominee can claim or continue the account.
  3. The scheme duration is 5 years, but it can be extended for another 5 years.
  4. Monthly deposits must be made on time. If not, a penalty of 1% per month is charged. If 4 instalments in a row are missed, the account may be closed.
  5. This scheme is a safe and simple way to turn small savings into a big fund.