Indian Post Office Money Savings Schemes Details [Finance]

Rajeev Reddy Nareddula 12/18/2023

Here's a guide on how to save money in an Indian office and some popular post office schemes with their interest rates and details:

Save money in an office savings account:

Many Indian offices offer savings accounts to their employees. These accounts usually have lower interest rates than traditional banks, but they can still help you save money. Check with your HR department to see if this option is available to you.

Use a salary-deduction scheme:

Some offices offer salary-deduction schemes, where a portion of your salary is automatically deducted and deposited into a savings account or mutual fund. This can help you build a habit of saving without having to actively transfer money each month.

Participate in company-sponsored investment schemes:

Some companies offer investment schemes to their employees, such as employee stock purchase plans (ESPPs) or provident funds (PF). These schemes can help you save money while also potentially earning higher returns than a traditional savings account.

Post Office Savings Schemes:

The Indian Post Office offers several savings schemes that can help you earn higher interest rates than traditional banks.

Indian Post Office Money Savings Schemes Details [Finance]

Here are some popular options:

Post Office Time Deposit (TD):

This scheme allows you to deposit money for a fixed period of time, ranging from 1 year to 5 years, with interest rates ranging from 5.5% to 6.7% per annum (as of August 2021). The longer the term, the higher the interest rate.

Post Office Recurring Deposit (RD):

This scheme allows you to deposit a fixed amount at regular intervals, such as monthly or quarterly, for a set period of time, ranging from 1 year to 10 years. Interest rates range from 5% to 6% per annum (as of August 2021). This scheme can help you build a regular savings habit.

Post Office Senior Citizens' Savings Scheme (SCSS):

This scheme is designed for senior citizens aged 60 and above, with an initial deposit of Rs 1,000 and subsequent deposits of Rs 1,000 or more per year. Interest rates range from 7.4% to 8% per annum (as of August 2021), depending on the amount deposited. This scheme also offers tax benefits for senior citizens under Section 80C of the Income Tax Act.

Post Office Monthly Income Scheme (MIS):

This scheme allows you to deposit a lump sum amount and receive monthly income for a fixed period of time, ranging from 6 months to 5 years. Interest rates range from 5% to 6% per annum (as of August 2021). This scheme can be useful for those who need regular income in retirement or during times of financial need.

Double Amount Scheme (DAS):

The Double Amount Scheme (DAS) is a special savings scheme offered by the Indian Post Office for senior citizens aged 60 and above. Under this scheme, the post office doubles the interest rate on the first Rs 50,000 deposited in a Post Office Savings Account, for a period of 5 years. The interest rate for the remaining balance is the same as that of the regular Post Office Savings Account.

The interest rate for the first Rs 50,000 under DAS is currently 7.4% per annum (as of August 2021), while the interest rate for the remaining balance is 4% per annum. This scheme can help senior citizens earn higher interest rates on their savings and provide them with additional income.

Sukanya Samriddi Account (SSA):

The Sukanya Samriddi Account (SSA) is a savings scheme offered by the Indian Post Office to promote education and financial security for girl children. The scheme is open to girls aged 0 to 14 years, and can be opened by parents or legal guardians on behalf of the girl child.

Under this scheme, an initial deposit of Rs 250 is required, followed by regular deposits of Rs 100 or more per month, up to a maximum of Rs 1.5 lakh in total deposits. The account matures when the girl child turns 21 years old, and the accumulated balance, along with interest earned, is paid out to her.

The interest rate for SSA is currently 7.6% per annum (as of August 2021), compounded annually. This scheme can help parents and legal guardians save for their daughter's education and future financial needs, while also providing her with a lump sum at maturity.

Kisan Vikas Patra (KVP):

The Indian Post Office Kisan Vikas Patra (KVP) is a government-backed savings scheme designed to promote agriculture and rural development. Here are the details of the KVP scheme:

1. Eligibility:

Any Indian citizen, including minors, can open a KVP account. There is no maximum limit on the number of accounts that can be held by an individual.

2. Deposit amount and tenure:

The minimum deposit amount for KVP is Rs 1,000, and multiples thereof. There is no maximum limit on the deposit amount. The tenure of the KVP scheme is currently 124 months (10 years and 4 months), from the date of issue of the certificate.

3. Interest rate:

The interest rate for KVP is currently 6.9% per annum (as of August 2021), compounded annually. The interest rate is fixed for the entire tenure of the scheme.

4. Maturity:

Upon maturity, the principal amount and accrued interest are paid out to the certificate holder in the form of a bond issued by the Government of India, which can be encashed after 1 year from the date of issue. The bond is transferable and can be pledged as collateral for loans.

5. Tax benefits:

The principal amount and accrued interest earned from KVP are exempt from income tax under Section 10(15) of the Income Tax Act, provided that the certificate is held for a period of at least 5 years from the date of issue. This makes KVP an attractive option for tax-saving purposes.

Overall, KVP offers a fixed return on investment with tax benefits, making it a popular choice among investors looking for a safe and secure investment option with guaranteed returns.

Official Website: https://www.indiapost.gov.in/Financial/pages/content/post-office-saving-schemes.aspx

Note: Please visit your nearest branch for more accurate details.