In today’s time,saving money and investing it in the right place has become necessary for everyone. But if you also want to start saving with less money and expect safe returns,then the Post Office Recurring Deposit (RD) scheme can be a great option for you. The special thing about this scheme is that you can start saving with just ₹ 100 and earn good interest with a government guarantee. This scheme is easy and beneficial for everyone including working professionals,students,and housewives. The best thing is that there is no risk at all,as it is backed by the government. So let’s know about this scheme in detail and understand how you can earn big profits from small savings!
Post Office RD Scheme
The Post Office Recurring Deposit Scheme is a popular savings scheme run by the Department of Posts of the Government of India. It is also called the National Savings Recurring Deposit Account. The main objective of this scheme is to inculcate the habit of making small savings in people and secure their future. Whether you are a job holder,a student,or a housewife,this scheme is simple and beneficial for everyone. The biggest advantage is that it is backed by the government and there is absolutely no risk in it.
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Start the savings journey with just ₹ 100
In this scheme,you deposit a fixed amount every month,starting from a minimum of ₹ 100. There is no upper limit in this,that is,you can deposit as much as you want according to your capacity. However,the deposit amount should be in multiples of ₹ 10. This scheme is for 5 years,in which you have to deposit money every month. On completion of 5 years,you get back both your principal amount deposited and the interest earned on it. Interest is calculated every quarter so that your savings keep increasing gradually. This is a great way to inculcate the habit of regular savings.
Attractive interest rate
Now let’s talk about the interest rate. At present,the current interest rate on the Post Office RD scheme is 6.7% per annum. This rate is fixed by the government every quarter,so it may also change. However,there has been no change in it since January 2024. But once you start investing in the scheme,the interest rate is locked for your entire 5 years. That is,if you start investing today,you will get interest at the rate of 6.7% for the next 5 years,even if the rates change later. This stability makes this scheme even more attractive.
Profit of up to ₹ 7258 from small savings of ₹ 100
So,let us now understand how much return can be obtained if you invest money in this scheme. Suppose,you decide to deposit ₹ 100 every month. Since the duration of the scheme is 5 years i.e. 60 months,you will deposit a total of 60 x 100=₹6,000. Now we have to calculate the interest rate of 6.7% on this. However,solving this formula by hand can be a bit complicated,so let’s look at an easy example. If you deposit ₹100 every month,your total investment in 5 years will be ₹6,000. At 6.7% interest rate,you will get an interest of around ₹1,258. This way,on maturity you will get a total of ₹6,000 + 1,258=₹7,258. That is,even with a small saving of ₹100,you can earn an additional profit of ₹1,258 in 5 years.
Now if you invest a little more,like ₹1,000 every month,then the calculation will be something like this. Your total investment in 5 years will be 60 x 1,000=₹60,000. With an interest rate of 6.7%,you will get an interest of about ₹12,580. That is,on maturity,you will get ₹60,000 + 12,580=₹72,580. You can use this amount as per your needs for emergency funds,children’s education,or to fulfill any of your small wishes.
Opening an RD account is very easy
Starting investing in this scheme is also very easy. You just have to go to your nearest post office. There you have to fill out an application form and submit the required documents for KYC like an Aadhar card,PAN card,and address proof. After this,your account will be opened by paying the first deposit amount (minimum ₹100). If you want,you can also open it alone or as a joint account with two or three people. If you are above 10 years of age,you can also open your account yourself.
Keep these important things in mind before investing
However,it is important to keep some things in mind while investing in RD. If you forget to deposit in any month,you must pay a penalty of ₹ 1 per ₹ 100. The account can be closed after defaulting four times. Apart from this,if you need money,you can withdraw money from the scheme after 3 years,but some conditions and penalties will apply to it. Apart from this,tax may also have to be paid on the interest received from this scheme. If your annual interest income is more than ₹ 10,000,10% TDS will be deducted. Therefore,understand these rules thoroughly before investing.
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