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Home » A Secure Investment To Earn Higher Returns – Post Office Fixed Deposit

A Secure Investment To Earn Higher Returns – Post Office Fixed Deposit

Post Office Fixed Deposit

A post office fixed deposit is a great alternative to traditional bank fixed deposits. They’re much less popular than the bank ones but are equally safe and usually carry lower interest rates. After all, you’re essentially putting your money into the Government Savings Account of the Indian Postal Service. So why not put your money there in the first place?

Post office fixed deposits are a type of fixed deposit issued by the Indian Postal Services. They are backed by the sovereign guarantee of the Government of India. The post office FD interest rates range from 5.5% p.a. to 7.5% p.a., making them an extremely attractive option for savers who want better returns on their savings account while keeping the liquidity available within 24 hours. As per the present interest rate scenario, a post office FD is much better than going for a monthly income scheme or debt mutual fund scheme, where you have to wait for months before getting your returns from the invested amount and may even lose some investment due to volatility in stock markets.

Features of Post Office FD

Tenure: 1,2,3 and 5 Years

Minimum Deposit Amount: Rs. 200 – 1000

Interest Rates: 5.5 – 6.7% p.a

Interest Payment: Annually

Mode of Payment: Cash or Cheque

Premature Withdrawal: Allowed after 6 months

Facility for Nomination: Available

Benefits of Post Office FD

Lost Cost Investment: Imagine, if you can put your money in a bank account (at any post office) with only Rs 200 and no maximum limit on the amount of money you can invest! Yes. That is right. The minimum deposit amount in Post Office Fixed Deposit is only Rs 200 – 1000, and there is no maximum ceiling on FDs.

Great Returns: Under a Post Office Fixed Deposit scheme, currently, you can earn up to 7.7% on the amount deposited by you. If you are looking for a safe investment option that adds value to your hard-earned money, you can go for a Post Office FD scheme. This is one of the safest ways to minimize your tax payable and earn a decent return on your savings at the same time.

No Inconstancy: Post office Fixed Deposits are safe, secure investments that give you a fixed rate of interest. The rate of interest you earn is not affected by market fluctuations, so it remains the same whether the markets are going up or down.

Withdraw in Need: Locking your money in a fixed deposit can be a great decision. However, the longer the maturity period, the higher the interest rate you get in return. Whereas you can withdraw the amount even before maturity if you are in need. Although you will have to pay certain charges to do the same.

Tax Benefits: To continue enjoying tax benefits, you need not make any changes. The tax deductions will be applicable under Section 80C of the Income Tax Act, 1961. Senior Citizens will stand to enjoy tax exemption of up to Rs.50,000 under Section 80TTB.

Post Office FD Calculator

Converting your money into FDs can be the best and easiest way to save some bucks! All you need is to invest in an FD with a bank. And there’s no rocket science involved! In fact, it’s as simple as 1,2,3. But before investing in a fixed deposit, it’s important to know exactly how much you will earn with the FD calculator for Post Office Fixed Deposits offered by various banks.

An FD calculator is a web tool that is used to calculate the accurate fixed deposit interest rate easily. You can make a choice of investing in a Post Office FD from many banks like SBI, ICICI Bank, Axis Bank, etc. These banks have their own Fixed Deposit Calculator which is useful to know the exact amount you will earn before investing in FD. All you need to know is just the deposit amount, interest rate, and tenure before clicking on the ‘Calculate’ button.

In Conclusion

In order to generate higher interest than a normal savings account, FDs are a better option. This is because they generally come with variable interest rates which are at least one percentage point higher as well as a longer tenor. But before investing, don’t forget to use a Post Office FD Calculator. The FD calculation should give you a clear picture of the interest rate and the amount you will earn in that period of time. If you like, you can even do a comparison with other banks to see which one provides the best interest rate. That way, you can make an educated investment choice.

FAQs

No, this scheme is not available online by the Indian Post.

Yes, When you open a Fixed Deposit account, you can nominate a relative, a family member, or a friend as the secondary holder of the account.

No, there is no set limit of the maximum amount to get deposited in the Post Office FD

No, You can open a fixed deposit account under the scheme only if you are a resident of India and have a post office savings bank account.

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