The Post Office offers a range of savings schemes catering to all age groups and financial needs. These schemes not only ensure the safety of your investment but also provide attractive returns. Among these, the Post Office Recurring Deposit (RD) is a standout option for investors.
People often look for secure investment avenues where they can save their hard-earned money and watch it grow. Post Office Small Saving Schemes, including the Post Office RD, are immensely popular for this very reason. In this scheme, you can accumulate up to Rs. 8 lakh by simply investing Rs. 5,000 every month, with the added benefit of easy loan access on the invested amount.
Interest Rates on Post Office RD
In 2023, the government increased the interest rates for the Post Office Recurring Deposit Scheme, offering a rate of 6.7%. These revised rates are applicable for the October-December 2023 quarter. It’s important to note that the interest rates for Post Office Small Savings Schemes are reviewed and revised every three months. The last update was on 29th September 2023.
How to Build a Fund of Rs. 8 Lakh
Calculating your investment returns in the Post Office RD is simple. If you invest Rs. 5,000 every month for five years, you will have deposited Rs. 3 lakh by the end of the term. With the 6.7% interest rate, the interest earned on this deposit will be Rs. 56,830, bringing your total fund to Rs. 3,56,830 in five years.
But the benefits don’t end there. You can extend your RD account for another five years. If you continue investing, the total amount deposited over 10 years will be Rs. 6,00,000. The interest earned during this period will be Rs. 2,54,272, resulting in a final corpus of Rs. 8,54,272.
Loan Facility on Post Office RD
One of the unique features of this scheme is the loan facility. You can open a Post Office RD account with a minimum deposit of Rs. 100. The account matures in five years, but if you wish, you can withdraw your investment early, after three years. Furthermore, once your account has been active for a year, you can avail a loan of up to 50% of the deposited amount. The loan interest rate will be 2% higher than the scheme’s current interest rate.
By making use of these benefits, you can easily grow your savings while maintaining financial flexibility.
