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Post Office RD Plan: Earn ₹6.42 Lakh in 5 Years with Small Monthly Savings
Looking to build a big fund with small, consistent savings? The Post Office Recurring Deposit (RD) Scheme might be the perfect solution. With just ₹100 per month, you can create a guaranteed corpus of ₹6.42 lakh in 5 years — a safe and secure way to grow your money.
This government-backed scheme is ideal for those who want assured returns without taking market risks. Let’s explore how it works, what benefits it offers, and how you can open an RD account today.
What is Post Office RD Scheme?
The Post Office RD (Recurring Deposit) Scheme allows you to invest a fixed amount every month and earn interest that is compounded quarterly. After the 5-year term, you receive a lump sum maturity amount including your deposits and the interest earned.
Key Features:
| Feature | Details |
|---|---|
| Minimum Investment | ₹100 per month |
| Tenure | 5 years |
| Interest Rate | 5.8% per annum (compounded quarterly) |
| Flexibility | Choose any monthly amount in multiples of ₹10 |
| Nomination Facility | Available |
| Loan Facility | Can avail loan against RD after 1 year |
How Does the Post Office RD Work?
The RD scheme is based on a simple principle: invest regularly and let your money grow steadily. Interest is calculated every quarter and added to your balance. Over 5 years, this results in a significant corpus.
RD Investment vs Maturity Table
| Monthly Investment | Interest Rate | Duration | Maturity Amount |
|---|---|---|---|
| ₹1000 | 5.8% | 5 years | ₹6,42,000 |
| ₹2000 | 5.8% | 5 years | ₹12,84,000 |
| ₹3000 | 5.8% | 5 years | ₹19,26,000 |
(Maturity amounts are indicative and assume consistent deposits.)
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Benefits of Investing in Post Office RD
Guaranteed Returns
Since it’s a government scheme, your money is secure with fixed returns.
📉 Low Risk
Unlike mutual funds or stock market investments, RD doesn’t carry any market risk.
📊 Disciplined Saving Habit
Perfect for building a habit of saving small amounts regularly.
🏦 Loan Against RD
You can take a loan against your RD after 12 installments have been paid.
How to Open a Post Office RD Account?
Opening an RD account is easy and requires minimal documentation.
Documents Required:
- Identity proof (Aadhaar card, PAN card, etc.)
- Address proof (Electricity bill, Ration card, etc.)
- Passport-size photograph
- Nomination form
Step-by-Step Process:
- Visit your nearest post office.
- Fill the RD account opening form.
- Submit required documents.
- Make your first deposit (minimum ₹100).
- Set a fixed date for monthly payments.
Important Points to Remember
- Interest is compounded quarterly.
- If you miss a deposit, a small penalty may apply.
- Investment amount cannot be changed once set.
- RD does not qualify for tax deduction under Section 80C.
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Frequently Asked Questions (FAQs)
🔹 Can I change the monthly deposit amount later?
No, once you set the amount during account opening, it cannot be changed.
🔹 Is it possible to open a Post Office RD account online?
Some post offices offer online RD account opening through the India Post website or app.
🔹 What happens if I miss a monthly deposit?
A small penalty is charged for delayed payments, but your account remains active.
🔹 Does Post Office RD offer any tax benefits?
No, RD deposits do not offer tax deductions, and the interest earned is taxable.
Final Thoughts
The Post Office RD Scheme is an excellent choice for conservative investors who want safe, consistent, and guaranteed returns. With just ₹100 per month, you can build a sizable fund of ₹6.42 lakh in 5 years — perfect for meeting future financial goals like education, travel, or emergencies.
🌱 Small savings today can create a big future tomorrow. Start your RD journey now!
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