The Post office has a Time Deposit (TD) program, often known as Post office FD, which is a dependable and government-backed investment choice. Here's how to treble your investment over 15 years using this strategy.
Key Features of Post office FD
Interest Rate: Currently, a 7.5% annual interest rate is available on 5-year FDs.
Tax Benefits: Investments in a 5-year FD qualify for deductions under Section 80C of the Income Tax Act.
Safety: As a government-backed scheme, it ensures high security for your money.
How to Triple Your Money
Step-by-Step Breakdown:
Initial Investment: ₹10,00,000 for a 5-year FD at 7.5% annual interest.
At the end of 5 years, you receive ₹4,49,948 as interest.
Total amount: ₹14,49,948.
First Extension: Reinvest the total amount (₹14,49,948) for another 5 years.
Interest earned: ₹6,52,401.
Total amount after 10 years: ₹21,02,349.
Second Extension: Reinvest the new total amount (₹21,02,349) for another 5 years.
Interest earned: ₹9,45,948.
Total amount after 15 years: ₹30,48,297.
Key Rules for FD Extension
Extension Timelines:
1-year FD: Extend within 6 months of maturity.
2-year FD: Extend within 12 months of maturity.
3/5-year FD: Extend within 18 months of maturity.
Interest Rates: The prevailing rate on the maturity date will apply for the extended period.
Benefits of the Scheme
Compounding Effect: By reinvesting your FD, you benefit from compounding, significantly increasing your returns.
Tax Savings: Avail tax deductions with a 5-year FD.
Government Security: Ensures your principal and interest are safe.
Key Features of Post office FD
Interest Rate: Currently, a 7.5% annual interest rate is available on 5-year FDs.
Tax Benefits: Investments in a 5-year FD qualify for deductions under Section 80C of the Income Tax Act.
Safety: As a government-backed scheme, it ensures high security for your money.
How to Triple Your Money
Step-by-Step Breakdown:
Initial Investment: ₹10,00,000 for a 5-year FD at 7.5% annual interest.
At the end of 5 years, you receive ₹4,49,948 as interest.
Total amount: ₹14,49,948.
First Extension: Reinvest the total amount (₹14,49,948) for another 5 years.
Interest earned: ₹6,52,401.
Total amount after 10 years: ₹21,02,349.
Second Extension: Reinvest the new total amount (₹21,02,349) for another 5 years.
Interest earned: ₹9,45,948.
Total amount after 15 years: ₹30,48,297.
Key Rules for FD Extension
Extension Timelines:
1-year FD: Extend within 6 months of maturity.
2-year FD: Extend within 12 months of maturity.
3/5-year FD: Extend within 18 months of maturity.
Interest Rates: The prevailing rate on the maturity date will apply for the extended period.
Benefits of the Scheme
Compounding Effect: By reinvesting your FD, you benefit from compounding, significantly increasing your returns.
Tax Savings: Avail tax deductions with a 5-year FD.
Government Security: Ensures your principal and interest are safe.
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