These 6 Post Office Saving Schemes Give More Interest Than Savings Account

These 6 Post Office Saving Schemes Give More Interest Than Savings Account

Everyone understands the importance of money and wants to save it for future requirements. But that doesn't mean everyone know where to save it. Most of us go for a bank saving account as it gives us the freedom of withdrawing the money when the requirement arises. Banks give 4-6% interest on saving accounts. If you want to earn some higher interest, then post office saving schemes may be a good option for you. Moreover, the post office saving schemes are much more safe, secure and convenient method to save money. Let’s have a look at some post office saving schemes offer more interest than savings account.

Post Office Small Savings Schemes

Post Office Time Deposit Account

1. Time Deposit Account can be opened by any individual.

2. Joint account can be opened by two adults.

3. A minor of 10 years and above age can open and operate the account.

4. Time Deposit Account can be opened for 1, 2, 3 & 5 years.

5. The minimum amount that can be deposited is Rs. 200.

6. There is no limit on the maximum amount.

7. The investment qualifies for the benefit of Section 80C of the Income Tax Act, 1961.

8. Rates of Interest from 1.04.2020 are as follows:

For one year account: 5.5% per annum (quarterly compounded).

For two year account: 5.5% per annum (quarterly compounded).

For three year account: 5.5% per annum (quarterly compounded).

For five year account: 6.7% per annum (quarterly compounded).

Also read: Post Office Time Deposit Scheme

5 - Years Recurring Deposit (RD) Account

1. India Post offers a 5-Year Recurring Deposit (RD) Account.

2. It is a systematic deposit scheme that offers guaranteed returns over a fixed period of time.

3. A fixed equal amount of money deposited each month for a period of 60 months.

4. RD Account can be opened by any resident adult.

5. Joint account can be opened by two adults.

6. RD Account can be opened in the name of a minor through guardians.

7. A minor of 10 years and above age can open and operate the account.

8. From 1.04.2020, interest rates are 5.8% per annum (quarterly compounded). 

Also read: 5-Year Post Office Recurring Deposit Account

Post Office Monthly Income Account

1. Account may be opened by individual.

2. Account can be opened in the name of minor and a minor of 10 years and above age can open and operate the account.

3. Joint account can be opened by two or three adults.
4. An individual can invest maximum Rs. 4.5 lakh in MIS.
5. Interest can be drawn through auto credit into savings account standing at same post office, through PDCs or ECS.

6. In case of MIS accounts standing at CBS Post offices, monthly interest can be credited into savings account standing at any CBS Post offices.

7. Can be prematurely en-cashed after one year but before 3 years at the discount of 2% of the deposit and after 3 years at the discount of 1% of the deposit.

8. From 1.04.2020, interest rates are 6.6% per annum payable monthly.

Also read: Post Office Monthly Income Scheme Account 

Public Provident Fund (PPF) Account

1. Ideal investment option for both salaried as well as self employed classes.

2. Minimum deposit is Rs. 500/- Maximum deposit is Rs.1,50,000/- in a financial year.

3. Deposits can be made in lump-sum or in 12 instalments.

4. Deposits qualify for deduction from income under Sec. 80C of IT Act.

5. Maturity period is 15 years.

6. Withdrawal is permissible every year from 7th financial year.

7. Loan facility available from 3rd financial year.

8. From 1.04.2020, interest rates are 7.18% per annum (compounded yearly).

Also read: Public Provident fund Account

National Savings Certificate

1. National Savings Certificate is a risk free investment as it is a government scheme.

2. This scheme is specially designed for Government employees, Businessmen and other salaried classes who are Income Tax assesses.

3. You have to invest a minimum amount of Rs 100 in the NSC scheme.

4. There is no such limit for maximum investment.

5. The holder gets the tax benefit under Section 80C of Income Tax Act,1961.

6. NSC can be purchased anywhere in India from a post office.

7. Certificates can be kept as collateral security to get loan from banks.

8. Rates of interest are 6.8%. 

Also read: National Savings Certificate

Senior Citizen Savings Scheme (SCSS) Account

1. An individual of the Age of 60 years or more may open the account.

2. An individual of the age of 55 years or more but less than 60 years who has retired on superannuation or under VRS can also open account subject to the some conditions.

3. Account can be opened by cash for the amount below Rs.1 lakh and for Rs.1 lakh and above by cheque only.

4. There shall be only one deposit in the account in multiple of Rs. 1000/- maximum not exceeding Rs.15 lakh.

5. Maturity period of the scheme is 5 years.

6. After maturity, the account can be extended for further three years.

7. Premature closure is allowed after one year on deduction of an amount equal to 1.5% of the deposit & after 2 years 1% of the deposit.

8. From 1.04.2020, interest rates are 7.4% per annum. 

You may also like to read: Senior Citizen Savings Scheme Account
You may also like to read: What is SIP (Systematic Investment Plan)?
You may also like to read: How to Set Your Financial Life in Order?

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These 6 Post Office Small Savings Schemes give more interest than savings acccount