Amidst stock market volatility, investing in the Post Office's small savings schemes can be an excellent option. The advantage of these schemes is that there is no risk of losing invested funds, as the government itself provides the security guarantee. Furthermore, the government offers attractive interest rates, allowing a significant capital to be formed from small savings. One such instrument is the Post Office Regular Deposit Scheme (Post Office RD Scheme).
People usually plan to place their earned money in places where it will be safe and also generate good income. In this regard, the government's Post Office schemes are the best. Regardless of how small or large the deposit is, the government guarantees safety, making these schemes popular as zero-risk schemes. The Post Office RD Scheme is among them.
The Post Office Regular Deposit Scheme (PO RD Scheme) has a guarantee of fund preservation, and the government ensures investors a high interest rate of up to 6.7%. Opening an account in this scheme is possible with a minimum initial deposit of only 100 rupees, and there is no upper limit set for maximum investment, allowing for higher returns if one wishes to invest more.
In addition to being effective for accumulating large sums, the Post Office Regular Deposit Scheme offers several other advantages. The maturity period for this scheme is set at five years, but investors are given the option to close the account before this period expires. Moreover, the account term can be extended for another five years. An account for this scheme can be opened at any nearby Post Office.
The Post Office Regular Deposit Scheme also provides the possibility of obtaining a loan against the deposited amount. However, there are specific rules for this. After completing one year of investment in the PO RD Scheme, the investor can apply for a loan based on the amount in the account. The condition is that only 50% of the deposited amount can be withdrawn, and the interest on this loan will be very low—only 2%.
With this state scheme managed by the Post Office, one can accumulate 25 lakh rupees through regular contributions. The calculation for accumulating this large sum is quite simple. Using the Post Office RD Calculator, one needs to deposit 15,000 rupees monthly. By the time of maturity, i.e., after 5 years, the total fund will amount to 1,070,492 rupees, of which the interest income will be 170,492 rupees. To reach a larger sum, the monthly contributions need to be extended for another five years. In that case, with a 10-year investment, the total fund will increase to 2,562,822 rupees, and the interest income alone will reach 7,52,822 rupees.