Postal Savings Plan: Citizens of India, largely in the lower middle class and middle class sections, still rely on savings schemes that guarantee an assured return at maturity so that none of their hard-earned money is lost . Therefore, they tend to invest their money in government supported programs. The post, in this regard, is a reference for all those who want to obtain guaranteed and good returns on their investments. Several savings schemes offered by India Post are among the most popular risk-free savings schemes in the country.
Besides those for particular groups, the post office also offers savings schemes such as recurring deposits, where the interest rate is compounded quarterly. The main advantage of the 5-year Postal Recurring Deposit Account is that you can open it in your child’s name and thus ensure a bright future for him. You just need to be listed as their legal guardian to open the recurring deposit account at the post office. As the name suggests, the maturity period of this scheme is five years.
The plan, with its good interest rate, is a popular option among parents who want to save money for their children’s future.
Post Office Recurring Deposit Calculator
To get a good return from this scheme, all you have to do is deposit Rs 70 every day in the RD account opened in your child’s name. This means that you deposit a monthly amount of Rs 2,100 into the account. After five years, you would have saved Rs 1,26,000 in the account.
On top of that, you would have earned interest on the amount you deposited, which is compounded quarterly. The post office is offering an interest rate of 5.8% on its recurring deposit accounts from April 2020. This means that over five years the interest would amount to more than Rs 20,000 under from the program. So, if we calculate the total money, your child will get a return of Rs 1,46,000 after five years, which is almost equivalent to Rs 1.5 lakh.
Key Features of Post Recurring Deposit Account
Eligibility: Any Indian adult can open a single account or a joint account of up to three adults under this program. Apart from this, a guardian on behalf of a minor, a guardian on behalf of an insane person and a minor over 10 years old can open the account in his own name.
Account limits: The minimum amount for monthly deposit is Rs 100 and above the minimum in multiples of Rs 10, the India Post said on its website. There is no upper limit for this account.
Other Features: One can close this account prematurely after three years of continuous deposits, but the interest calculated in this case would be the same as that of the savings account. However, the duration of this account can be extended up to five years.
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