How to Grow Your Wealth by Depositing ₹700 Monthly in a Post Office RD

Looking for a safe investment? A Post Office RD is a low-risk way to grow your money. By investing ₹700 per month, you can earn ₹49,955 in 5 years. Learn how to open an RD, understand the benefits, and get expert tips on maximizing your returns. Read now!

By Praveen Singh
Published on
How to Grow Your Wealth by Depositing ₹700 Monthly in a Post Office RD
Post Office RD

Saving money is a crucial habit that ensures financial stability. One of the best low-risk investment options in India is the Post Office Recurring Deposit (RD) scheme. If you deposit ₹700 per month, you can accumulate a substantial amount over time, thanks to the power of compound interest. But how much exactly can you earn? And how does the scheme work? This article breaks down everything you need to know.

Depositing ₹700 Monthly in a Post Office RD

FeatureDetails
Investment Amount₹700 per month
Tenure5 years (60 months)
Interest Rate6.7% per annum (subject to change)
Total Deposited₹42,000
Maturity AmountApprox. ₹49,955
Tax BenefitsNo tax deduction under Section 80C
Early WithdrawalAllowed after 1 year with penalty
Official SourceIndia Post

The Post Office RD scheme is an excellent way to build a habit of saving and grow your wealth over time. By depositing just ₹700 per month, you can accumulate nearly ₹50,000 in 5 years with minimal risk. If you’re looking for a safe, government-backed investment, this is a great option. To get started, visit your nearest post office or check online for application details.

What Is a Post Office RD?

A Recurring Deposit (RD) account is a savings scheme where you deposit a fixed amount every month. The Post Office RD is one of the most reliable options because it is backed by the Government of India. It offers a fixed interest rate and ensures steady returns, making it a great option for conservative investors.

see also: you will get 35 lakhs by depositing 50 rupees daily

How Much Will You Earn by Depositing ₹700 Per Month?

If you deposit ₹700 every month in a Post Office RD for 5 years, you will accumulate ₹49,955. Here’s a breakdown:

  • Total Deposits: ₹700 x 60 months = ₹42,000
  • Interest Earned: Approx. ₹7,955
  • Maturity Amount: ₹49,955

This calculation is based on the current Post Office RD interest rate of 6.7% per annum. The rate is subject to change, so always check the latest figures on the official India Post website.

Step-by-Step Guide to Open a Post Office RD Account

1. Visit Your Nearest Post Office

Head to the nearest post office with the required documents. You can also check if your post office offers an online RD opening facility.

2. Fill Out the RD Application Form

Ask for the RD account opening form and provide your details like name, address, and nominee details.

3. Submit Required Documents

You need to submit the following:

  • Aadhaar Card or PAN Card (for identity proof)
  • Address Proof (Utility bill, voter ID, etc.)
  • Passport-sized photographs

4. Deposit the First Installment

You must make an initial deposit, which can be ₹700 or more, depending on your choice.

5. Get Your Passbook

Once the account is opened, you will receive a passbook containing your account details, deposit history, and maturity date.

Advantages of Investing in a Post Office RD

Safe and Secure Investment

Your money is completely safe, as the scheme is backed by the Government of India.

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Guaranteed Returns

Unlike stocks or mutual funds, your returns are fixed and do not depend on market fluctuations.

Ideal for Small Savings

You can start with a minimum deposit of ₹100 per month, making it ideal for salaried individuals and students.

Easy Withdrawal Options

  • You can prematurely close the account after one year, but a penalty will apply.
  • You can take a loan against your RD balance.

see also: 6.7% interest on Post Office RD, loan will also be available without breaking the account!

Depositing ₹700 Monthly in a Post Office RD FAQs

1. Is interest earned on RD taxable?

Yes, the interest earned on a Post Office RD is fully taxable under income tax laws.

2. Can I increase my monthly deposit later?

No, once you open an RD account, your monthly deposit remains fixed until maturity.

3. What happens if I miss an installment?

If you miss a deposit, a penalty of 1 rupee for every 100 rupees will be charged.

4. Can I open multiple RD accounts?

Yes, you can open multiple RD accounts in your name.

5. How is RD different from an FD?

In an RD, you deposit money monthly, whereas in an FD, you invest a lump sum amount.

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