Post Office Savings Scheme (PSS)
Department of Posts under Ministry of Communications regulates the country's postal system also generates investors
with several deposit avenues, widely known as post office saving
schemes.
Post Office Investments includes a range of saving schemes which include
high-interest rates as well as tax advantages and, most significantly,
have Indian Government's sovereign guarantee. There are some services in the Post Office Saving Schemes that
deliver efficiency and risk-free returns on capital. Such schemes are
run by 1.54 lakh post offices throughout the country.
Few Post Office Saving Schemes that Offer Better Returns than Bank Deposits
Such schemes have been launched to establish avenues for investment and
reinforce savings against the investment of Indian individuals. All
schemes come under the Post Office Savings Scheme are accessible through
all the post office of India which also enables the individual to make a
faster registration and enrollment. Currently, the government offers
general citizens with 9 postal saving schemes for savings.
Benefits of Post Office Savings Scheme
Post Office Saving Schemes include some of the basic features and
benefits which are listed below:
Efficient and secure
Apart from the applicable circumstances, all post
office savings schemes are supported by the government.
Guaranteed and attractive return
In every 3 months the Ministry of
Finance changes the interest rates of the post office savings scheme. The applicable interest rates on Post Office Savings Scheme keeps
changing.
Easy investment process
Minimum paperwork and easy verification
processes provided by the post office make it easier for you to apply to
any of the saving schemes.
Long term investments schemes
Many of the post office saving schemes
are long term investments with a tenure up to 15 years. Many of the
saving schemes for post offices are long-term savings and will last up
to 15 years. A long term, like PPF, enables an individual over time to
increase substantial assets. Therefore, they can be recognized as
valuable financial security plans as well as pension benefits.
Tax benefits
Tax benefit is one of the most recognized aspects of the
post office savings scheme. Some schemes like National Saving
Certificates provide tax exemptions on the amount of the deposit under
Section 80C. Also, few schemes like Kisan Vikas Patra provide tax
deductions on the interest earned.
Beneficial to the investors of every income criteria
Post Office
Savings Scheme are Postal assets are planned to reach investors through
various economic structures and from every corner of the country. Any
Indian citizen can take advantage of these schemes with 1.55 lakh
branches of post offices, from rural to metropolitan.
Various Available Options
Indian post-savings schemes re scattered
through various forms of savings and investment products to accommodate
for specific investors. An array of financial products to choose such as
savings deposit, recurring deposit, fixed deposit, monthly scheme,
saving certificates, and more. From these options, investors can select
according to their financial targets.
Post Office Savings Schemes
- Post Office Savings Account 5-Year
- Post Office Recurring Deposit Account (RD)
- Post Office Time Deposit Account (TD)
- Post Office Monthly Income Scheme Account (MIS)
- Senior Citizen Savings Scheme (SCSS)
- 15 year Public Provident Fund Account (PPF)
- National Savings Certificates (NSC)
- Kisan Vikas Patra (KVP)
- Sukanya Samriddhi Accounts (SSA)
Who can Invest in Post Office Savings Scheme?
The above-listed schemes can be opted by investors who choose a
portfolio with no-risk investing coupled with a significant return.
The minimum investment amount is also affordable, thus investors from
the lowest income classes can glance forward to investing in such
schemes as well.
Process to Apply for a Post Office Savings Scheme
Visit your nearest post office branch,
Get the relevant application form according to your selected scheme.
However you can also download these forms online from the official site
of the India post.
Fill out the form with all the mandated details correctly and submit
it along with your KYC proof and photographs, or any other required
documents as per your selected scheme.
Complete the process by submitting the minimum investment amount as
per your selected scheme.
Types of Post Office Savings Scheme
Post Office Savings Account
- With Min of Rs.500, open a savings account with the post office
- You can only open one account with one post office and the account
is transferable too across India.
You can open an account under a minor 's name, too.
Post Office Monthly Income Scheme
- Minimum amount of Rs 1500 up to a maximum of Rs.4.5 lakhs in a single account and Rs.9 lakhs for joint accounts.
- Maturity period of 5 years.
- One can maintain multiple accounts with a maximum investment of Rs.4.5 lakhs in all.
- A penalty will be charged of 2% if the investor withdraws the amount between 1 year to 3 years, similarly 1% penalty will be charged on withdrawals after 3 years.
- Transferable from one place to another within India.
Post Office Recurring Deposit
- 5-year RD account with a number of accounts
- Extendable on a year-to-year basis for 5 additional years.
- Minimum of Rs.10 per month and any amount in multiples of Rs.5.
- Transferable from one post office to another RD account
- Allows a partial withdrawal up to 50% of the balance after a year.
- Post office RD has no TDS on interest.
Post Office Time Deposit
- Time deposits for 1, 2, 3 and 5 years of tenure.
- Minimum of Rs 200 can be invested without any upper limit
- One can hold a number of accounts
- Under the scheme Accounts in a single holding or joint holding method can be opened. Even an investment is authorized in the minor 's name.
- Accounts can be transferred from one post office branch to another across the country.
- Renewable with the existing interest rate on maturity day for the same term.
- Tax benefit under Section 80C of The Income Tax Act, 1961.
Kisan Vikas Patra
- The investment is accessible in Rs.1,000, Rs. 5,000, Rs.10,000 and Rs. 50,000 denominations and comes with a minimum investment limit of Rs 1000 with no upper limit.
- Certificates can be transferred easily and can be approved to the third person.
- Certificate in existence is comparatively liquid because it provides
withdrawal facility after 2.5 years of investment tenure.
Senior Citizen’s Savings Scheme
- Minimum eligibility age is 60 years.
- One can also invest in this scheme after his/her voluntary retirement after 55 years of age.
- The minimum investment amount is Rs 1000 and the maximum investment cap allowed per individual is Rs.15 lakh.
- A person can hold several accounts with his spouse under his or her name or in joint holding.
- Premature withdrawal is also allowed in the scheme after a year with a penalty of 1.5%. After 2 years of deposit, 1 per cent penalty is levied.
- An account can be extended for another three years.
- Tax benefit under Section 80C of The Income Tax Act is available
for the principal amount invested by an investor up to the limit of Rs.
1.5 Lakh.
Public Provident Fund
- PPF is a long-term fund offered at an interest rate of 7.1 per cent per annum (compounded annually) over a duration of 15 years.
- Minimum amount of Rs. 500 and a maximum of Rs. 1.5 lakhs per fiscal year.
- You can open the account in a single holding type only.
- Partial withdrawal is only allowed after the completion of 5 years from the date of the account opening.
- Investors can take benefit of the loan facility from the third fiscal year after Investment in PPF account
- Tax exempted under Section 80C of The Income Tax Act upto Rs. 1.5 lakh. The total return earned is completely tax-free.
National Savings Certificate (NSC)
- The NSC has a 5 year maturity period.
- The NSC interest rate is compounded half-yearly but payable at maturity.
- Minimum of Rs.1,000 (or multiples of Rs.100) with no upper limit
- The account can be opened a single adult, on behalf of a minor above 10 years of age
- Investment in NSC is tax free under Income Tax Act Section 80C upto Rs. 1.5 Lakh.
- Investors are also allowed to avail loans from the bank
- NSC is transferable - an investor can transfer his /
her certificate from person to person across India.
Sukanya Samriddhi Accounts
- Sukanya Samriddhi is a girl child support scheme launched by the government of India.
- Minimum investment of Rs.250 up to a maximum of Rs.1,50,000/- in a financial year.
- Tax rebate upto Rs 1.5 lakh per year under Section 80C. Interest is tax-free and the amount of maturity is tax-free.
- The account can only be opened on behalf of a girl child by parents or legal guardians.
- The girl's age on the day of account opening should be 10 years or less.
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