Post office FD, not bank, is making you rich, you are getting strong interest of up to 7.5% on deposits.

Post Office FD Scheme: If you are looking for a safe investment and are fed up with low returns from bank FD, then Post Office Fixed Deposit (FD) scheme can be a great option for you. At present, when the effect of change in repo rate is clearly visible on the FDs of banks, the time deposit scheme of the post office is giving attractive interest of up to 7.5 percent to the investors.

Why is Post Office FD ineffective with repo rate? (Post Office FD Scheme)

Post office savings schemes are not directly affected by the repo rate of the Reserve Bank of India (RBI). The interest rates of these schemes are decided by the Central Government on a quarterly basis. This is the reason why even when interest rates on bank FDs are reduced, post office FD rates remain stable and investors get better returns.

How much interest on post office time deposit?

Post Office Time Deposit Scheme is available for tenures ranging from 1 year to 5 years. Interest rates are also different on different tenures. At present, interest of up to 7.5 percent is being given on 5 year post office FD, which is more than the FD of many banks. This interest is compounded annually, making the investors’ money grow faster.

Why is it beneficial for investors?

Post Office FD is backed by the government, hence it is considered a very safe investment. There is no market risk in this and assured returns are available at fixed time. The special thing is that tax exemption under Section 80C of Income Tax can also be availed on 5 year FD, which makes this scheme attractive from the point of view of tax saving.

Who can invest?

Any Indian citizen can invest in Post Office Time Deposit. In this, along with single account, joint account facility is also available. The account can also be opened in the name of a minor. Due to low minimum investment amount, this scheme is also very useful for small investors.

Why better than bank FD?

While on one hand many banks are offering interest on FD around 6 to 6.5 percent, on the other hand post office FD is offering returns up to 7.5 percent. Apart from this, government guarantee and stable interest rate make it more reliable than bank FD. This is the reason why at present investors are increasingly turning towards post offices.

If you want good returns without risk, then Post Office FD scheme can be a strong option for you. Unaffected by repo rate fluctuations, with government guarantee and interest rates up to 7.5 percent, this scheme is really making investors rich.

Also Read:Post Office RD Scheme: A little savings every month, a reliable source of big income in the future, this scheme of Post Office is very wonderful.