The Post Office Recurring Deposit (RD) Scheme is one of the most trusted small savings schemes in India, offering safe returns and guaranteed growth on your investments. If you’re looking for a reliable way to grow your savings systematically, depositing Rs 2500 every month in the Post Office RD Scheme can yield impressive benefits over time. This article explains how the scheme works, what benefits you can expect, and why it is a smart choice for individuals of all ages.
Saving regularly is a proven way to achieve financial stability. The Post Office RD Scheme is backed by the Government of India, making it a safe and risk-free option. It allows investors to deposit a fixed amount every month and earn attractive interest rates with quarterly compounding.
Post Office RD Scheme
| Feature | Details |
|---|---|
| Monthly Deposit Amount | Rs 2500 (You can invest more or less as per your capacity) |
| Scheme Tenure | 5 Years (60 months) |
| Interest Rate (as of Q1 2024) | 6.7% per annum, compounded quarterly |
| Total Investment | Rs 1,50,000 (if Rs 2500 deposited every month for 5 years) |
| Maturity Amount | Approximately Rs 1,76,000 (includes principal + interest) |
| Loan Facility | Available after 12 months (up to 50% of the balance) |
| Rebate on Advance Deposit | Rebates offered for 6-month and 12-month advance deposits |
| Premature Withdrawal | Allowed after 3 years with penalties |
| Taxability | Interest earned is taxable as per individual income tax slab |
| Official Website | India Post |
The Post Office RD Scheme is an excellent choice for anyone looking to cultivate disciplined savings with guaranteed returns. Depositing Rs 2500 every month may seem like a modest start, but over 5 years, it can grow into a substantial sum of approximately Rs 1.76 lakhs, thanks to quarterly compounding and a secure, government-backed platform.
How Does the Post Office RD Scheme Work?
The process of investing in the Post Office RD Scheme is straightforward and beginner-friendly:
1. Open an RD Account
Visit your nearest post office with the following documents:
- Aadhaar Card
- PAN Card
- Passport-sized photo
- Initial deposit amount (Rs 100 minimum)
- Duly filled RD account opening form
You can also open a joint RD account with up to three individuals or even in the name of a minor.
2. Deposit Rs 2500 Monthly
Make a fixed monthly deposit of Rs 2500 for a period of 5 years. You can either deposit manually at the post office or automate it via electronic transfer.
3. Interest Calculation
The interest rate is currently 6.7% per annum, compounded quarterly. This means every quarter, interest is added to your account balance, and future interest is calculated on this increased amount, ensuring higher returns over time.
4. Maturity Value
After 5 years:
- Principal invested: Rs 1,50,000 (Rs 2500 x 60 months)
- Interest earned: Around Rs 26,000
- Total maturity amount: Approximately Rs 1,76,000 (subject to prevailing interest rates)
5. Loan Facility
Need emergency funds? After making 12 deposits, you can take a loan up to 50% of your RD balance. The loan interest rate is 2% higher than the RD interest rate.
see also: Post Office TD Scheme Benefits
Benefits of Depositing Rs 2500 Monthly in Post Office RD Scheme
1. Disciplined Savings
By committing to monthly deposits of Rs 2500, you ensure that a portion of your income is consistently saved.
2. Guaranteed Returns
Unlike market-linked investments, Post Office RD offers fixed returns, shielding you from market volatility.
3. Loan Flexibility
Access to loans against your RD balance ensures liquidity during emergencies without breaking your savings plan.
PPF Monthly Income: पोस्ट ऑफिस की योजना में बनाएं 41 लाख का फंड, हर महीने कमाएं 24 हजार, देखें पूरी जानकारी
4. No Upper Limit on Deposits
While Rs 2500 is a popular choice, you can invest any amount in multiples of Rs 10, starting from Rs 100.
5. Safe & Secure
The scheme is government-backed, ensuring 100% capital safety.
How Much You Will Get After 5 Years
Let’s break down the math:
- Monthly deposit: Rs 2500
- Total tenure: 5 years = 60 months
- Interest rate: 6.7% p.a. (compounded quarterly)
Using India Post’s RD formula:
M=P×(1+r/n)nt−1(1−(1+r/n)−1)M = P \times \frac{(1 + r/n)^{nt} – 1}{(1 – (1 + r/n)^{-1})}
Approximate maturity:
- Principal: Rs 1,50,000
- Interest: Around Rs 26,000
- Maturity value: Rs 1,76,000
How to Open a Post Office RD Account
- Visit the nearest post office.
- Carry KYC documents (Aadhaar, PAN, Passport-sized photo).
- Fill out the RD account opening form.
- Make an initial deposit (minimum Rs 100).
- Start monthly deposits (set Rs 2500 or your preferred amount).
- Track your passbook or opt for electronic statements.
You can also open and manage your RD account via India Post Payments Bank (IPPB) Mobile App.
see also: Post Office Personal Loan: How to Get Loan from Post Office?
POST OFFICE RD SCHEME FAQs
1. What is the minimum deposit amount in the Post Office RD Scheme?
The minimum deposit is Rs 100 per month, in multiples of Rs 10.
2. Can I deposit more than Rs 2500 per month?
Yes, there is no upper limit on deposits. You can invest any amount as long as it’s in multiples of Rs 10.
3. Is the interest on Post Office RD taxable?
Yes, the interest earned is fully taxable under your applicable income tax slab.
4. Can I withdraw RD before maturity?
Premature withdrawal is allowed only after 3 years with a penalty.
5. Can I take a loan against my RD account?
Yes, after 12 deposits, you can borrow up to 50% of the balance.
