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FD vs NSC Post Office Schemes: If you are looking for a scheme in which you get good interest and also save your tax, then you can get this double benefit in post office schemes. Like banks, post offices also run many types of schemes, which provide good profits. For better interest rates and tax benefits, you can invest in Post Office 5 Year Fixed Deposit Scheme (Post Office FD). This is known as Post Office Time Deposit. 5 year FD is called tax free FD.
Apart from Post Office FD, you also have a good option of investing in National Savings Certificate. In this also you can avail good interest and tax exemption. At present, interest is available on post office FD at the rate of 7.5 percent. Whereas in NSC, interest is available at the rate of 7.7 percent. Let us tell you that if you are investing ₹ 2,00,000, then how much money will you get on 5 year FD and how much return will you get on 5 year NSC.
Returns on Post Office FD and NSC
If you invest Rs 2,00,000 in post office FD, then calculations based on the current interest rate of 7.5 percent show that you will get Rs 89,990 as interest on it. In this way your maturity amount will be Rs 2,89,990. If you invest Rs 2,00,000 in NSC of Post Office, then you will get interest of Rs 89,807 on it at the rate of 7.7 percent in 5 years. In this way you will get a total of Rs 2,89,807 on maturity.
Why low returns on NSC despite high interest?
If you look at the calculations here, you will see a slight difference in the returns of both. But one thing to be noted is that despite the high interest rate on NSC, the returns are low, whereas despite the low interest rates on FD, high returns are being received. This is because in Post Office FD the interest is calculated on quarterly basis and in NSC on annual basis.