post office scheme
If you want to invest your hard-earned money in a safe and reliable place, then post office savings schemes are a great option. There is a government guarantee in these schemes, so your money remains completely safe. There are different schemes available for people of all ages, from children to women and elderly people. One of these is Post Office Time Deposit Scheme, which people open just like FD. Its specialty is that the interest in it is so attractive that you can earn more than Rs 2 lakh on the basis of interest alone.
Why is this Time Deposit Scheme so popular?
In Post Office Time Deposit Scheme, interest is decided depending on the period of investment. This interest is given by the government, so there is no risk in it. The interest rates in this scheme are quite competitive. 6.9% for one year, 7% for two years, 7.1% for three years, and 7.5% on maximum 5 year investments. This is the reason why most people choose a 5-year plan, because it gives the best returns.
How to earn 2 lakhs just from interest?
If you want to know how Rs 2 lakh can be earned from interest only, then its calculation is very easy. Suppose you open a time deposit of Rs 5 lakh for 5 years. You will get 7.5% annual interest on this. On completion of five years, the total interest reaches to around Rs 2,24,974, that is, by adding interest to your principal amount of Rs 5 lakh, you will get Rs 7,24,974 directly on maturity. Meaning, you will get additional income of more than Rs 2 lakh in your pocket without any risk.
Safe investment and tax savings too
This scheme is completely risk free as it is directly backed by the Government of India. Interest is added to your account every year, so that your money keeps growing continuously. The best thing is that by choosing a 5 year time deposit, you also get the benefit of tax exemption under Section 80C of the Income Tax Act. That means this scheme gives you a combo of security, better returns and tax savings.
Who can open this account?
In this scheme, a minimum of Rs 1000 is required to open an account, and there is no limit on maximum investment. You can open both single or joint account. Apart from this, a child above 10 years of age can also open a time deposit account in his own name. Opening an account is also very easy, just go to your nearest post office and complete the process with some simple documents.