Indian Post offers a range of investment schemes for customers, including individuals and even a girl child. Generally, saving schemes offered by Indian Post are commonly known as post office saving schemes. All the Post offices investment schemes are backed by the Government of India, which guarantees returns. In addition, some of the post office saving schemes also offer tax benefits up to INR 1.5 lakhs upon investment.
In this article, we’ll cover different post office saving schemes as well as the benefits of post office schemes in detail, including Post Office Savings Account(SB), National Savings Recurring Deposit Account(RD), National Savings Time Deposit Account(TD), National Savings Monthly Income Account(MIS), Senior Citizens Savings Scheme Account(SCSS), Public Provident Fund Account(PPF), Sukanya Samriddhi Account(SSA), National Savings Certificates (VIIIth Issue) (NSC), and Kisan Vikas Patra(KVP).
Let’s start the journey with the explanations of each of these post office savings scheme.
1. Post Office Saving Account (SB)
- Post office savings account is pretty similar to opening a savings account in a bank. The only difference is that it is held with a post office.
- The investor needs to remember that only one account can be opened with one post office and only can be shifted from one post office to another.
- The post office also allows opening an account in the name of a minor or person of unsound mind. The interest rate offered is 4.0% per annum on an individual and is completely taxable. However, no TDS is deducted in the same.
- The minimum deposit amount to open a Post Office Savings Account is INR 500. The account can be opened in single or joint ownership by residents, but the transfer of single to a joint account or vice versa is not permissible.
2. National Savings Recurring Deposit Account (RD)
- National Savings Recurring Deposit Account or Post office RD offers monthly investment for a fixed period of 5 years. The interest offered is 5.8 % per annum (quarterly compounded).
- After completing the fixed tenure of five years, this post office savings scheme with INR 5000 invested monthly will provide you with a maturity amount of INR 3,48,483.64.
- The account holder can also continue the account for more than 5 years on a yearly basis, even after completing its tenure.
- The post office RD account helps small investors by allowing them to invest as little as Rs 100 monthly and above the minimum in multiple of Rs. 10. There is no upper limit for the investment.
3. National Savings Time Deposit Account (TD)
- National savings time deposit account (TD) offers different tenure options for investments.
- The minimum amount that is required to open a post office time deposit account is Rs 1000. There is no upper limit for depositing and no restrictions on the number of accounts one individual can hold.
- An individual is free to open the account in the single holding or joint holding pattern. Also, creating an account in the minor’s name is allowed.
4. National Savings Monthly Income Account (MIS)
- Post office national savings monthly income account is among the exclusive schemes that assures account holders a fixed monthly lump sum made by the investor.
- Anyone can open the MIS account in a single or joint holding design. The most significant part is that a minor is also allowed to open an account in this scheme. If the minor’s age is more than 10 years, then he can even monitor the account.
- The minimum amount required for the investment is Rs 1000, and the maximum investment limit is INR 4.50 lakh in an individual holding account and INR 9 lakhs for joint accounts.
- The current interest rate offered by the scheme is 6.6 % per annum, payable monthly, including a maturity period of 5 years.
5. Senior Citizens Savings Scheme Account (SCSS)
- The minimum age required for buying this scheme is 60 years for the senior citizen saving scheme. Also, citizens who choose voluntary retirement after 55 years of age can open an account within a month of receiving the retirement benefits.
- The maximum amount one can invest in this scheme is 15 lakh in multiples of 1000.
- The investor is allowed to hold or retain multiple accounts in his name or joint holding with the spouse.
6. Public Provident Fund Account (PPF )
- Public provident fund account is a pretty popular long-term investment scheme for the tenure of 15 years currently offered at an interest rate of 7.1 % per annum (compounded yearly).
- Any individual can create such an account as there is no restriction on the minimum or maximum age of account opening.
- The minimum amount necessary for the investment is Rs 500, and the maximum of Rs 1.50 lakh in a financial year. The amount can be deposited in a lump sum or 12 equal installments.
7. Sukanya Samriddhi Account(SSA)
- Honourable Prime Minister Narendra started sukanya samriddhi yojana for the betterment and upliftment of the girl child. Currently, the scheme provides an attractive higher interest rate of 7.6% per annum compounded yearly.
- The minimum amount with which one can start investing in this scheme is INR 250, and the maximum is 1,50,000 in a financial year. Also, the investor needs to deposit at least the minimum amount every year for 15 years from the account opening date.
- The account can be opened in the name of the girl child by her parents or legal guardians. The only requirement is that the girl’s age should be 10 years or less at the time of opening the account.
8. National Savings Certificates (NSC)
- The national savings certificates account is a reliable, tax-efficient and risk-efficient saving scheme for traditional and long-term investors.
- It comes with a maturity period of 5 years and offers an interest rate of 6.8 % compounded annually but payable at maturity.
- The national savings certificates scheme doesn’t have any maximum limit on the investment, and the minimum amount of investment is Rs 100. This scheme provides a reliable, risk efficient, and tax-efficient saving scheme for long-term investment.
9. Kisan Vikas Patra(KVP)
- An investor can open a Kisan Vikas patra account in any of the post offices. Currently, it offers an interest rate of 6.9 % compounded annually.
- The minimum amount necessary for opening an account is 1000 with no maximum limit.
- The invested amount doubles every 112 months ( 9 years and 4 months)