Post office savings schemes: The Finance Ministry announces rates on small savings schemes every three months. Interest rates have not been changed for last many quarters. Last rate announcement was made for the October-December 2024 quarter for these small savings schemes. Thanks to the RBI keeping the repo rate high for almost 2 years, deposit schemes, including FDs, have been benefitted tremendously. Compared to bank FDs, post office FDs either match the rates of some top bank FD returns or give even better yields.
Post-office savings schemes give investors many options with interest rates up to 8.2%. Most of these post-office schemes offer tax benefits also under Section 80C of the Income Tax Act. It is, however, suggested that investors should carefully evaluate the tax implications of these post office savings schemes before making investment decisions. Here we will discuss various features, tenures and returns of top 5 post-office savings schemes.
Public Provident Fund (PPF):
The Public Provident Fund (PPF) is a long-term investment option helping small investors park their money in a government backed scheme that assures fixed returns along with tax benefits.
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PPF interest rate: The PPF offers 7.1% interest per annum.
Tax benefits: PPF falls in the EEE category, which means your deposits are tax free, interest earned is also tax free and the maturity amount is exempted from tax. Deposits made up to Rs 1.5 lakh during the year can be claimed under section 80C of the Income Tax Act.
You can invest in PPF for 15 years, but it can be extended in blocks of 5 years after maturity.
Also read: Post Office Savings Schemes: Check out THESE top 5 plans with better interest rates than most bank FDs!
Sukanya Samriddhi Yojana (SSY):
Sukanya Samriddhi Yojana is a government of India scheme launched to protect financial future of your girl child. Under the scheme, an account can be opened with a minimum amount of Rs 250 and the maximum deposit can be Rs 1.5 lakh in a year.
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