look news india
New Delhi: All the schemes in the post office work like a bank and good interest is available on it. One of those schemes is Post Office Time Deposit. Which is colloquially called Post Office FD. In the post office you get the options of FD with tenure of 1, 2, 3 and 5 years. Interest rates vary depending on the tenure. But if you want to get more profits then invest in a five-year FD, this will give you tax benefits as well as interest rate benefits. But if you are investing in it, do not try to break it even before five years, otherwise you will suffer loss.
This FD will turn ₹5,00,000 into ₹7,24,974 in 5 years.
Talking about the benefits of this FD, currently interest on time deposits is available at the rate of 7.5 percent. So if you invest ₹5 lakh in it, you will get ₹2,24,974 interest in five years. Then on maturity after five years you will get ₹ 7,24,974. Apart from this, you will also get tax benefit on FD under section 80C.
There will be loss if plucked prematurely
If you want to earn good profits from this FD then do not break it before its maturity period, otherwise you will suffer a big loss. As per the rules, if you close an FD account with a tenure of 5 years after 6 months but before the completion of 1 year, you will get a refund on the investment as per the interest rate applicable on the savings account. Currently, post office savings account offers interest at the rate of 4%.
When you close the FD after one year, the money will be returned to you after deducting 2% interest from the prevailing interest rate applicable on fixed deposits. That is, if you are getting interest at the rate of 7.5 percent, then in case of pre-mature closure this interest will reduce to 5.5 percent.
What are the interest rates on Post Office TD?
One Year Account – 6.9% interest per annum
Two Year Account – 7.0% p.a. interest
Three Year Account – 7.1% interest per annum
Five year account – 7.5% interest per annum
Post Office Time Deposit Special
In Post Office Time Deposit you can deposit minimum Rs 1000 and there is no maximum limit.
You can open as many accounts as you want, there are no account restrictions.
Whatever interest rate is there at the time of opening the account, the same interest rate will remain applicable till the maturity of the account.
The interest on your investment in Post Office Time Deposit is calculated on a quarterly compounded basis but this interest is compounded and credited to your account at the end of the year.
On completion of exactly one year from the date of account opening, interest will accrue on your account.
Anyone above 18 years of age can open a TD account. Accounts can be opened for children by their parents or guardians. After completing 10 years of age the child can operate the account with his/her signature. He can also open an account in his own name. If you open a time deposit account for 5 years, then you can get tax exemption under section 80C on the money deposited in it.