Earn interest up to 7.75% p.a. by investing in a Bajaj Finance Fixed Deposit | Rated CRISIL AAA/ STABLE and [ICRA]AAA(stable)

A Post Office Fixed Deposit is a savings scheme offered by India Post through various post offices spread across the country. Since India Post is a Government of India initiative, there’s absolutely zero investment risk involved. Post Office Fixed Deposit Interest rates are usually higher than what most scheduled banks offer. Hence, this makes it a great investment option for investors looking for stable returns with the least amount of risk involved.

Post Office Fixed Deposit Calculator

You can now instantly calculate your returns on investments using the Post Office FD Calculator .

 

Yearly Investment
Tenure
Yr
Interest Rate
%
Your Total Maturity Amount is
₹6,78,035
Maturity ₹6,78,035
Investment ₹3,75,000
Interest ₹3,03,035

 Post Office FD Interest Rate  

 FD Interest rates in Post Office start at 5.5% per annum and go all the way up to Rs. 6.7% per annum, depending on the tenor that you opt for. The accumulated interest is calculated on a quarterly basis, but is only paid out annually.  

 

The following table will give you a clearer idea on FD Interest Rates in Post Office as per different tenors:

Tenor

Post Office FD Interest Rate 

1 Year

5.5% per annum

2 Years

5.5% per annum

3 Years

5.5% per annum

5 Years

6.7% per annum

Note: The Post Office FD interest rate specified above are applicable from 01.07.2022 onwards.

Features and Benefits of the Post Office Fixed Deposit Scheme

The Post Office Fixed Deposit Scheme includes the following features and benefits:

Features

Benefits

Low Minimum Investment Limit

The minimum amount that you can invest in a Post Office Fixed Deposit is Rs. 1,000 which makes it an affordable investment.

Tax Benefits 

The amount that you invest in a Post Office FD can be claimed as a deduction from your total taxable amount under Section 80C of the Income Tax Act of 1961. 

Attractive Interest Rates

FD rates in Post Office range from 5.5% p.a. To 6.7% p.a. which is more than what most scheduled banks offer. 

Integration with a Savings Account

A Post Office Fixed Deposit can be integrated with your Savings Account which lets you redirect your interest rates on the Fixed Deposits to your Post Office Savings Account.

Premature Withdrawal

A Post Office FD allows you to prematurely withdraw your FD after the expiry of 6 months from the date of deposit. 

Easy Accessibility 

Since the scheme is backed by the government it has a relaxed eligibility criteria.

 

Eligibility Criteria to Open a Post Office Fixed Deposit

If you’re looking to invest in a Post Office Fixed Deposit , here’s a quick look at who can open an FD in Post Office :

 

  • A single adult individual (for single account)

  • Up to three adults (for joint account) 

  • A guardian on behalf of a minor or a person of unsound mind 

  • A minor over the age of 10 

Post Office Fixed Deposit VS Bajaj Finance Fixed Deposit

Bajaj Finance is a NBFC that also offers fixed deposit schemes to individuals.

Here’s a short comparison between the Post Office Fixed Deposit scheme and the Bajaj Finance Fixed Deposit scheme:

Bajaj Finance Fixed Deposit

Post Office Fixed Deposit

Bajaj Finance Fixed Deposit interest rates are as high as 7.50% for non-senior citizens.

the maximum interest rate offered by Post Office Fixed Deposits is 6.70%. 

Witd a Bajaj Finance FD, senior citizens get an additional 0.25% on tde existing rate of interest.

No additional benefits in Post Office Fixed Deposit interest rate for senior citizens. 

You can open a Bajaj Finance FD online from The comfort of your home. 

The application process for a Post Office Fixed Deposit is manual.

You can easily renew your Bajaj Finance Fixed Deposit witd The Auto-renewal option.

Auto renewal for an FD in Post Office  is available only at CBS-enabled branches

The Bajaj Finance Fixed Deposit is trackable online. 

A Post Office Fixed Deposit does not have such provisions.

Post Office FD Interest Rate  and Interest Earned for Different Tenors 

Post Office FD interest rate varies depending on the tenor that you choose . FD rates in Post Office range from 5.5% p.a. to 6.7% p.a based on the tenor. 

 

Here’s an example to help you understand how much interest you’re likely to earn for different tenors on an investment amount of Rs. 1,00,000. 

Tenor

Post Office FD Interest Rate

Interest Earned 

Maturity Amount 

1 Year

5.5% per annum

Rs. 5,500

Rs. 1,05,500

2 Years

5.5% per annum

Rs. 11,302

Rs. 1,11,302

3 Years

5.5% per annum

Rs. 17,424

Rs. 1,17,424

5 Years

6.7% per annum

Rs. 38,300

Rs. 1,38,300

The FD rates in Post Office specified above are applicable from 01.07.2022 onwards. 

Post Office FD Interest Rates and Interest Earned for Different Tenors - Senior Citizens

Post Office FD interest rates are the same for both non-senior citizens and senior citizens. There’s no additional interest rate benefit offered. 

How is the Post Office FD Maturity Amount Calculated?

Although you can use a Post Office FD Calculator to arrive at the final maturity amount, it is still good to know how it is calculated.

 

Here’s the formula that’s used to arrive at the maturity amount of the FD:

Maturity Value = Principal amount * (1 + interest rate ÷ 4)(n * 4)

Here, ‘n’ represents the tenor. 

 

Let’s apply this formula to calculate the maturity amount that you’re likely to end up with on an investment of Rs. 1,00,000 at the end of a tenor of 5 years. The Post Office FD interest rate on a tenor of 5 years is currently 6.7%. 

 

Maturity Value = Rs. 1,00,000 * (1 + 0.067 ÷ 4)(5 * 4)

 

Maturity Value = Rs. 1,38,300

 

At the end of the 5-year tenor, you stand to receive Rs. 1,38,300  in return for your investment amount of Rs. 1,00,000. 

How to Open an FD in Post Office

To open an FD in Post Office , you would have to physically visit a post office branch nearest to you and follow the steps listed below:

 

  1. Request for Form 1, which is the application form to open an FD in Post Office .

  2. Fill the application form and affix your photograph and signature in the respective fields. 

  3. Submit the duly filled Form 1 along with all the documents required to open an FD in Post Office . 

  4. Your Post Office Fixed Deposit  will be opened within a few days from the submission of Form 1 and you will be notified via SMS on your mobile. 

Documents Required to Open an FD in Post Office

To open an FD in Post Office , here’s a list of the documents required along with the application form:

 

  • Identity Proof - PAN, Aadhaar, Voter ID, or Passport

  • Address Proof - Aadhaar, Passport, driving license, or utility bills

  • 2 passport size photographs 

Different Types of Post Office Tax Saving Schemes

In addition to the FD facility, India Post offers several other tax saving schemes as well. Some of them are as follows:

 

  • Senior Citizens Savings Scheme (SCSS)

  • Sukanya Samriddhi Account

  • National Savings Certificate (NSC)

  • Public Provident Fund (PPF)

TDS on Post Office Fixed Deposit

  • TDS is a mechanism through which the paying entity deducts taxes from your income and pays it to the Income Tax Authorities on your behalf. 

  • In case of an FD in Post Office, India Post deducts a percentage of the accumulated interest and pays it on your behalf to the Income Tax Authorities. 

  • TDS on FD is only applicable if the interest generated during a year exceeds Rs. 40,000 (for non-senior citizens) and Rs. 50,000 (for senior citizens).

  • India Post currently deducts a 10% TDS on FDs, provided you disclose your PAN details. In the case of non-disclosure of PAN details, a 20% TDS will be deducted. In case of non-resident Indians, a 30% TDS plus surcharges and cesses are applicable. 

  • If your total taxable income is less than Rs. 2.5 Lakh, you can seek a waiver of TDS by submitting Form 15G with India Post. 

FAQs

  • ✔️Can I prematurely withdraw funds from a Post Office Fixed Deposit ?

    Yes. You can withdraw a Post Office Fixed Deposit prematurely. However, it can only be done after the expiry of 6 months from the date of deposit. 

  • ✔️Can I extend the tenor of an FD in Post Office ?

    Yes. You can choose to extend the tenor of an FD in Post Office up to a maximum of 2 times. However, you would have to lodge an extension request within specific time limits depending on your tenor. Here’s a quick look:

     

    • For 1-year FDs - within 6 months from the date of repayment

    • For 2-year FDs - within 12 months from the date of repayment

    • For 3-5 year FDs - within 18 months from the date of repayment 

  • ✔️Can I avail a loan against the Post Office Fixed Deposit ?

    Yes. You can pledge your Post Office Fixed Deposit . To do so, you would have to submit Form 5 at the post office along with an acceptance letter from the pledgee.

     

    You can pledge your Post Office Fixed Deposit with the following individuals or entities:

    • The President of India or the Governor of a State in an official capacity

    • The Reserve Bank of India, a scheduled bank, a cooperative society, or a cooperative bank

    • A Public Corporation

    • A Private Corporation

    • A Government Company

    • A Local Authority

    • A Housing Finance Company approved by the National Housing Bank and notified by the Central Government

  • ✔️To whom would the Post Office Fixed Deposit be paid on account of the death of the account holder?

    • In the case of the account holder's death, the Post Office Fixed Deposit would be paid to the nominee listed at the time of opening of the FD.

    • If there are multiple nominees, the FD would be paid out in the proportion specified by the account holder. If the account holder hasn’t specified any proportion, the amount of the FD would be paid out equally to all the nominees listed.

    • If there’s no nominee, the proceeds of the FD would be paid out to the legal heir of the account holder.

    • If there are multiple account holders, the FD in Post Office will go to the surviving account holders. 

  • ✔️What are the different types of forms available for a Post Office Fixed Deposit account?

    There are as many as five forms for an FD in Post Office , with each one serving a different purpose. Here’s a quick look at what they are:

     

    • Form 1 - To an FD in Post Office

    • Form 2 - To close a Post Office Fixed Deposit

    • Form 3 - To extend the maturity date of the FD

    • Form 4 - To prematurely withdraw the FD

    • Form 5 - To pledge the FD 

  • ✔️What is a Post Office FD Calculator?

    A Post Office FD Calculator is a free online tool that allows you to calculate the total amount and the amount of interest component that you’re likely to obtain upon maturity.

  • ✔️How to claim a refund of TDS deducted on Post Office FD ?

    If your total taxable income during a year doesn’t exceed Rs. 2.5 Lakh, you can claim a refund of TDS deducted on your Post Office Fixed Deposit .

     

    To claim a refund of TDS, you would have to file your ITR. Here’s a brief outline of the process that you would have to follow:

     

    • Visit the Income Tax website - https://www.incometax.gov.in/iec/foportal

    • Login to your account using your credentials.

    • Select the ITR that’s applicable to you and proceed towards filing the same.

    • E-verify the ITR using your bank’s internet banking facility, Aadhaar verification, or digital signature.

    • The TDS deducted will be refunded to you after your ITR is processed by the Income Tax Department.

  • ✔️How long would it take for the TDS refund to be processed in case of a Post Office Fixed Deposit ?

    Usually, it takes anywhere from 3 to 6 months from the date of completion of verification of your ITR for you to receive the TDS refund. 

  • ✔️Should I invest in an FD in Post Office or in a Bajaj Finance FD?

    Both FD schemes have their own set of advantages. The decision on which scheme you should invest in is completely dependent on your needs and requirements. 

  • ✔️How to calculate Post Office FD Maturity Amount?

    You can use the Post Office Fixed Deposit Calculator available on the website or use the following formula to calculate the Maturity amount:

    Maturity Value = Principal amount * (1 + interest rate ÷ 4)(n * 4)

  • ✔️What are the fixed deposit rates in Post Office for Senior Citizens?

    Fixed deposit rates in Post Office for both Senior as well as Non-Senior citizens are the same. There is no additional Post Office Fixed Deposit Interest Rate provided.

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