Post office savings schemes are always been a charm for Indian investors as being considered one of the safest form of investments. Certain schemes enjoys tax exemption making them a preferred mode of investments. Let us see the interest rates offered in these schemes
National Savings Certificate
This scheme is specially designed for Salaried either Government or private employees, Businessmen, others who are Income Tax assesses. Trust and HUF cannot invest.With no maximum limit for investment and No Tax deduction at source it offers an interest of 8.5% for 5 years and 8.8% for the period of 10years. The NSC certificate can be kept as collateral security to get loan from banks. Also, Investment up to INR 1,50,000/- per annum qualifies for IT Rebate under section 80C of Income Tax Act. Minimum INR. 100/- No maximum limit available in denominations of INR. 100/-, 500/-, 1000/-, 5000/- & INR. 10,000/-.
Maturity value of a certificate of INR.100/- purchased on or after 1.4.2012 shall be INR. 151.62 after 5 years. Maturity value of a certificate of INR.100/- purchased on or after 1.4.2012 shall be INR. 236.60 after 10 years.
Recurring Deposit Account
Any individual (a single adult or two adults jointly) can open an account. The Advance Deposits earn rebate and rate of interest is 8.3%. Four defaults are allowed in this scheme however defaults can be paid within two months. You can partially withdraw your money and also premature closure is allowed onnly after 3 years. Maturity value of a 5 Years RD account opened on or after 1.4.2013 with monthly deposit of INR.10/- shall be INR.744.53.
The rate of interest on PPF stands at 8.7 per cent, compounded annually, with effect from April 1, 2013, according to an RBI notification. The returns from PPF are attractive as the entire interest amount is exempt from Income tax unlike other schemes. However, interest rates are better with Banks if you do not fall under any income tax bracket.
Post Office Monthly Savings Scheme
The post office monthly savings schemes are currently offering an interest rates of 8.4 per cent. This scheme is the best for retired employees/Senior Citizens or any one with high sum for investment. The maturity period for this scheme is 5-years.
Post Office Time Deposits
The rate of interest is 8.20%, 8.20%, 8.30% and 8.40% compounded quarterly for 1,2,3 & 5 years TD account respectively. In case of premature closure of 2 year, 3 year or 5 year account on or after 01.12.2011, if the deposit is withdrawn after the expiry of one year from the date of deposit, interest on such deposits shall be calculated at the rate, which shall be one per cent less than the rate specified for a period of deposit of 1 year, 2 year or 3 years as mentioned.
Senior Citizen Savings Scheme (SCSS) Account
This a new avenue of investment and return for Senior Citizen where individuals who has attained the age of 60 years or Who has attained the age 55 years or more but less than 60 years and has retired under a Voluntary Retirement Scheme or a Special Voluntary Retirement Scheme on the date of opening of the account within three months from the date of retirement. The scheme offers an interest @ 9.20% per annum from the date of deposit on quarterly basis. Interest can be automatically credited to savings account provided both the accounts stand in the same post office.