5 min read
Updated on Sep 02, 2022
Making investments from an early age is as important as becoming financially independent. And once you have a job, you should start looking for investment options that are suitable for you. And for the newcomers in investment, what can be better than a Post Office RD account, right? As a matter of fact, you can open an RD account in your preferred bank as well. However, many people choose Post Office over banks when it is to open an RD account. The reason behind this is the rate of interest. The Post Office RD interest rate 2022 is 5.8% per annum.
|Rate of Interest||5.8% per annum. It is compounded quarterly.|
|Tenure||5 years. Can be extended for the next 10 years upon completion of the first 5 years.|
|Minimum deposit||INR 100 p.m.|
|Maximum deposit||There is no upper limit|
|Penalty for missed deposit||INR 1 for every INR 100|
One needs to meet the following criteria to open an RD account in a Post Office.
In the case of a minor account holder, the account has to be operated jointly with their guardian. A minor cannot handle the account single-handedly.
Recurring Deposit is mostly opted for by working-class people. It is considered a medium-term investment option. The majority of people open an RD account to secure their immediate future. If you are planning to invest your hard-earned money in an RD account, you have to make the deposits for the next five years without fail. The minimum period of Post Office Recurring Deposit is 5 years.
Once your tenure is over, you may extend the period if you wish to. India Post enables the customers to extend the tenure of the RD accounts. However, you also need to know that the extendable period is a maximum of 10 years and not more than that. Also, when you extend the tenure of your RD account, the calculation of compound interest for each quarter remains the same.
While we consider opening an RD account, we need to know the features of this kind of account. So, here are some of the features mentioned below:
A Post Office RD account can be transferred from one Post Office to the other.
Read More: Post Office Monthly Income Scheme
Not all days are the same for us. And it is quite normal that an account holder is not able to deposit in a month because of some kind of financial crisis. Well, in that case, as per the Post Office RD rules, you can make such defaults a maximum of 4 times. Upon crossing the 4-time limit, your account will be inactive. The account can be revived within 2 months. Going by the Post Office RD rules, for each INR 100, you would be required to pay INR 1 as a penalty. The penalty has to be paid besides the regular deposits.
In case you need money and you want to withdraw it from your Post Office RD account, it is possible. However, to make this happen, you would be required to keep your account active for a minimum of 1 year. You also need to know, that only 50% of the available amount can be withdrawn from your RD account. You have to repay the amount that you withdrew. The repaid amount has to be deposited in a lump sum amount and the interest rate will be applicable. As the rate of interest for the withdrawn fund is concerned, it will be the current interest rate.
Now that you have enough information about the Post Office RD scheme, you can start searching for the nearest Post Office to your place. You can also use a Post Office RD calculator to find out the amount that you have to deposit every month. This calculator is an online tool and you can find it on many websites.
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