INSUBCONTINENT EXCLUSIVE:
not investing anywhere, you may be wondering where all your monthly income disappears
And if you are one of those who keep hoarding money in savings bank accounts, you are certainly not going to get a good return on your
The best way to grow your wealth is to start investing
The investment amount may be small but it is important to make a start and think of investing for a long term, say financial planners
For individuals who do not want to invest your money in share market, fixed income options such as recurring deposits (RDs) and fixed
deposits (FDs) may be a good idea.The Department of Posts or India Post offers both recurring deposits and term or fixed deposits under its
India Post offers nine saving schemes, including RDs and FDs, according to its website, indiapost.gov.in.Given below are the key features,
interest rates and the minimum/maximum amount required in a post office recurring deposit or fixed deposit:5-Year Post Office Recurring
Deposit Account (RD)Features of RDsAn RD account can be opened by cash or cheque and in case of cheque, the date of deposit will be the date
of presentation of cheque.A nomination facility is available at the time of opening and also after opening of the RD account.The RD Account
can be transferred from one post office to another.Any number of RD accounts can be opened in any post office.The RD account can be opened
in the name of minor and minor of 10 years and above age can open and operate the account.An RD account can also be opened jointly by two
adults.A subsequent deposit can be made up to 15th day of next month if the account is opened up to 15th of a calendar month and up to the
last working day of next month if account is opened between 16th day and last working day of a calendar month.If a subsequent deposit is not
made up to the prescribed day, a default fee is charged for each default, default fee at Rs 0.05 for every 5-rupee will be charged
After four regular defaults, the account becomes discontinued and can be revived in two months but if the same is not revived within this
period, no further deposit can be made.If in any RD account, there is monthly default amount, the depositor has to first pay the defaulted
monthly deposit with default fee and then pay the current month deposit, according to India Post. There is a rebate on advance deposit of
at least six installments.A single RD account can be converted into joint and vice-versa.A minor after attaining majority has to apply for
conversion of the account in his or her name.One withdrawal up to 50 per cent of the balance allowed after one year.Full maturity value
allowed on RD accounts restricted to that of Rs 50 denomination in case of death of depositor subject to fulfillment of certain
conditions.In case of deposits made in RD accounts by cheque, the date of credit of cheque into government accounts shall be treated as the
date of deposit.Interest rate on post office recurring deposit accountsFrom 1.01.2018, interest rate is 6.9 per cent per annum (quarterly
On maturity, Rs 10 account fetches Rs 717.43
The RD account can be continued for another five years on year-to-year basis.Minimum Amount for opening of post office recurring deposit
account and maximum balance that can be retainedA minimum of Rs 10 per month or any amount in multiples of Rs 5 is required to open an RD
There is no maximum limit.Post Office Time Deposit (TD) Account or Fixed Deposit (FD) AccountFeatures of post office FD accountsFD accounts
may be opened by any individual.An FD account can be opened by cash /cheque and in case of cheque the date of realization of cheque in
government account shall be the date of opening of account.A nomination facility is available at the time of opening and also after opening
of account.An FD account can be transferred from one post office to another.Any number of FD accounts can be opened in any post office.FD
accounts can be opened in the name of minor and a minor of 10 years and above age can open and operate the account.A joint FD account can be
opened by two adults.A single FD account can be converted into joint and vice-versa.A minor, after attaining majority, has to apply for
conversion of the account in his name.An under five-year investment in fixed deposits qualifies for tax benefit under Section 80C of the
Income Tax Act, 1961.Interest rates on post office FD accountsInterest rates from 1.01.2018 Period​Rate1-year A/c6.60%2-year
A/c​6.7%3-year A/c6.90%5-year A/c7.40%Minimum amount required for opening of post office FD account and maximum balance that can be
retainedA minimum of Rs 200 is required and in multiples thereof
There is no maximum limit.
