Post Office Scheme: Think about the post office if you wish to make a lump sum investment. This program gives an opportunity to even treble your starting out money. You can make ₹5,00,000 into almost ₹15,00,000 here.
Every parent hopes to provide their child the greatest life available when they are born, thereby avoiding hardships for them. Given this, many parents begin early on in their preparation of their children’s financial future. While some want lump payments to guarantee their child’s future, others choose investments in plans like PPF or Sukanya Samriddhi in the child’s name.
Should you also want to make a lump sum investment, give the Post Office Term Deposit (FD some thought. Better returns are offered by the post office’s five-year FD than by many banks. This plan lets you more than triple your money. Investing ₹5,00,000, for example, might finally yield ₹15,00,000 or more. This is how it operates:
How 5 lakhs became 15 lakhs?
Starting with ₹5,00,000 in a 5-year post office FD at an interest rate of 7.5%, you then want to grow ₹15,00,000. Your maturity figure at this pace will be ₹7,24,974 after five years. You reinvest this money for another five years rather than pulling back. Your total will be ₹10,51,175—more than twice your initial investment—after the 10-year term, having earned ₹5,51,175 in interest.
Reinvest your money once more for another five years to keep increasing it. At time of maturity, after 15 years, your original ₹5,00,000 will yield ₹10,24,149 in interest. Including this to your starting out investment, you will have ₹15,24,149 overall. Usually, a child’s financial demand emerges in their teenage years; so, this is the ideal period to apply the ₹15 lakh for their future.
Recognizing the Extension Rules
You will have to prolong your post office FD twice if you are aiming at ₹15 lakh. The main extending guidelines are as follows:
From maturity, a 1-year FD can be stretched six months.
One can extend a 2-year FD within 12 months from maturity.
A 3-year or 5-year FD has to be extended 18 months after maturity.
You can also ask for an account extension when opening the FD; the relevant interest rate at maturity will then apply for the extended period.
Post Office TD Interest Rates:
The post office provides FDs with different tenures and interest rates, same like banks. These are the present rates:
FD: 1-year: 6.9% annual interest
Two-year FD: 7.0% yearly interest
FD three years: 7.1% yearly interest
FD five years: 7.5% yearly interest
