Post Office Special Scheme: When a baby is born in the home, every parent believes that they will not let him suffer and will provide him with the greatest possible life. As a result, parents begin various types of financial preparation as soon as their child is born. Some people begin saving in schemes such as PPF and Sukanya in their child’s name, while others invest a lump sum cash someplace to meet the child’s future financial requirements.
If you want to invest a large sum, consider a Post Office Term Deposit, commonly known as a Post Office FD. A 5-year FD in the post office pays higher interest than a bank account. This strategy allows you to earn more than three times your investment, up to ₹15,00,000. Understand how this will work-
Post Office Special Scheme is how 5 lakhs becomes 15 lakhs
To turn 5 lakhs into 15 lakhs, invest ₹5,00,000 in a 5-year post-office fixed deposit. A 5-year fixed deposit at the post office pays 7.5 percent interest. Based on the current interest rate, the maturity amount after five years would be Rs 7,24,974. You are not obligated to withdraw this amount; rather, set it for the next five years. In this method, after 10 years, you will have earned Rs 5,51,175 in interest on a Rs 5 lakh sum, increasing your total to Rs 10,51,175. This figure is more than double.
However, you must set this amount for another 5 years, or again for 5 years each, so that your money is deposited for a total of 15 years. At maturity in the 15th year, you would earn Rs 10,24,149 in interest on your 5 lakh investment. You would gain a total of Rs 15,24,149 if you combine your deposited 5 lakhs with 10,24,149. A child’s financial demands typically emerge during their adolescence. In such a situation, you can easily invest these 15 lakh rupees for his future.
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Study the rules for extension
To add 15 lakhs, you must increase your post office FD twice. You should understand the rules that apply in this case. Post Office one-year fixed deposits can be extended within six months of maturity, whereas two-year fixed deposits must be extended within twelve months. The post office must be notified of any 3 or 5 year FD extensions within 18 months of maturity. You can also request an account extension beyond maturity when you open the account. The interest rate applicable to the specific TD account on the day of maturity will apply to the extended period.
Post Office Special Scheme : TD interest rates
Post offices, like banks, provide FDs with various terms. For each tenure, there are many interest rates readily available. Current interest rates are as follows.
- One-year account – 6.9% yearly interest
- A 2-year account with a yearly interest rate of 7.0%
- A 3-year account with a yearly interest rate of 7.1%
- Annual interest rate: 7.5% on a five-year account
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