The Indian post office, established in Oct 1854 during British rule, is one of the country's oldest organisations. It began by delivering mail and expanded to offer various financial services such as banking, insurance, and investments. These post office investment schemes have the advantage of being government-backed, ensuring a sovereign guarantee. Additionally, certain post office savings schemes provide tax-saving benefits under Section 80C of the Income Tax Act.
Here are some of the more prominent benefits of investing in postal investment schemes:
It is easy to invest in such schemes, and this is further compounded by the fact that they require limited documentation. The fact that the government upholds them enhances their credibility. By following a few simple steps at your local post office, you can invest in these safe investments that provide fixed returns.
Rural as well as urban investors can take advantage of post office schemes as post offices are located across the country. These schemes have been strategically designed to be simple so that their benefits can also be reaped by rural and uneducated people.
They can serve as good retirement or pension plans and can be extended for a period of up to 15 years, provided you have a public provident fund (or PPF). Holding such an investment can diversify your portfolio and gain access to risk-free and fixed returns.
The interest rates applicable to post office savings schemes fall between 4% to 8%. Not only are they risk-free, but these rates are highly competitive against those offered by banks. Since the government of India regulates these investments, minimal risks are involved.
Investors can take advantage of the wide range of investments offered by the Indian Post Office that are targeted to meet different investor requirements. These products have different tax implications, investment horizons, and anticipated returns.
The following features stand out when looking at the post office's monthly investment scheme.
Visit the nearest post office to invest in any of these schemes.
Here is a list of the top 6 post office savings schemes for the boy child in India.
Although post office investment schemes may not be well known, they should be taken advantage of. With minimal risks and competitive interest rates, they cater to various investor requirements. Various post office investment schemes are available, including Kisan Vikas Patra, National Savings Certificate, National Savings Monthly Income Account, National Savings Recurring Deposit Account, Public Provident Fund Account, Senior Citizens Saving Scheme Account, Sukanya Samriddhi Account, etc. The schemes have different maturity periods, allow for nominee assignments, and offer flexibility in terms of deposits and transfers. Overall, post office investment schemes present a range of benefits and options for investors to consider.
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No one scheme is the best among those offered by the post office as different schemes carry different benefits. The scheme you ultimately invest in should depend upon your goals, the time frame you are willing to allocate, the interest applicable and the caps on the amount you invest.
Fixed deposits at post offices pay interest on an annual basis; however, compounding occurs each quarter. At an interest rate of 6.7 per cent, such an investment would take ten years and five months to double in value.
The interest rates applicable to post office savings schemes fall between 4% to 8%.
The Sukanya Samriddhi Account has the highest interest rate, which amounts to 8%. The Kisan Vikas Patra account has an interest rate of 7.5%, where there is no limit on the amount invested each year.