5 min read
Updated on Sep 02, 2022
Fixed Deposits or FDs are the most common way of saving money, isn’t it? Our parents still consider FD accounts to be one of the safest saving options. In fact, when we start earning money, we are also encouraged to open an FD account so that we do not end up spending all our money. One can open an FD in a bank or post office. Let us today talk about FDs offered by the post offices in India.
The post offices in India are operated by the India Post. You can open an FD for a tenure period that ranges from 1 year to 5 years. The post office interest rate for FDs ranges from 5.50% to 6.70%. The post office FD interest rate for tax-saving FD for the general public is 6.70%. These kinds of FD schemes come with the highest form of capital protection as well as the certainty of income for the depositors since these are backed by the Union Ministry of Finance.
Post office fixed deposits are also called National Savings Time Deposits since these are operated by the National Savings Institute, which functions under the Department of Economic Affairs, Union Ministry of Finance.
|Tenure||1, 2, 3, and 5 years|
|Minimum Deposit Amount||INR 1,000|
|Interest Calculation||Compounded quarterly|
|Premature Withdrawal||Allowed after 6 months|
|Interest Rates||5.50% p.a. for 1, 2 and 3 year-tenures; 6.70% p.a. for 5 year tenure|
|For Senior Citizens||For Regular Citizens|
|Highest Slab Rate||6.70% p.a. (for 5 years)||6.70% p.a. (for 5 years)|
|For 1 year||5.50% p.a.||5.50% p.a.|
|For 2 years||5.50% p.a.||5.50% p.a.|
|For 3 years||5.50% p.a.||5.50% p.a.|
|For 5 years (including tax-saving FD)||6.70% p.a.||6.70% p.a.|
As mentioned above, the interest rates offered by the Post Office to the customers are the same for all age groups. There are no special rates offered to senior citizens.
Post Office FD, being backed up by the sovereign of India is an extremely secure and stable investment. Here are some prominent advantages of investing in the Post Office FD.
The account can be opened through the net banking facility. It is very easy to manage their account online and transfer funds as required. For this option, the depositor must have active savings account with the post office along with valid KYC documents, PAN card, updated email, and mobile number, and a Debit or ATM card issued from DOP. The following steps need to be followed:
Post Office FD is a great saving option for those who wish to securely save some money for the future while also earning interest according to Fixed Deposit rates in a Post Office. Those who are looking for more benefits from their savings may also consider life insurance products that provide comparable returns along with the added benefit of life insurance.
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