Maximize Your Savings with Post Office Time Deposit Scheme

If you’re seeking low-risk investment options with potential for substantial returns in a short period, the post office offers various schemes worth considering.

One such option is the Post Office Time Deposit, often referred to as Post Office FD.

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Advantages Over Bank FDs

While banks also provide FD options, the Post Office stands out, especially for a 5-year FD, offering attractive interest rates. Currently, a 5-year FD with the post office earns an interest rate of 7.5%.

Additionally, investors enjoy tax benefits under Income Tax Act 80C on this investment.

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Calculating Potential Returns

Let’s break down the potential earnings from investing in post office FDs,

considering different investment amounts:

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Investment of ₹3,00,000

Investing ₹3,00,000 in the post office time deposit scheme at a 7.5% interest rate yields ₹1,34,984 in interest.

Upon maturity, the total amount received will be ₹4,34,984.

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Investment of ₹2,00,000

For an investment of ₹2,00,000, the interest earned at 7.5% is ₹89,990.

At maturity, the total returns amount to ₹2,89,990.


Investment of ₹1,00,000

Typically, individuals invest ₹1,00,000 in FDs. At a 7.5% interest rate, the interest earned on this amount is ₹44,995.

Consequently, the total maturity amount would be ₹1,44,995.


Extending the Benefits

The post office FD scheme also offers extension options to further enhance your benefits.

You can extend a 1-year FD within 6 months of maturity, a 2-year FD within 12 months, and for 3 and 5-year FDs, the extension request must be made within 18 months of maturity.

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Moreover, you have the option to request an account extension at the time of opening the account.

During the extended period, the interest rate applicable will be based on the prevailing rates on the day of maturity.

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