Top 10 Post Office Saving Schemes For Secured Investment

India Post (Government of India, Department of Post) offers various savings schemes, each designed to cater to the unique requirements of individuals from all walks of life. Post Office Savings Schemes (POSS) have been a mainstay of financial security for millions of Indians for decades. These government-backed schemes offer a safe and reliable way to save money, earn interest, and achieve financial goals. This blog will discuss the ten most popular and valuable post office saving schemes you can consider investing in based on your investment appetite and plans.

Most of the schemes offer tax advantages under Section 80C of the Income Tax Act of up to Rs. 1.5 lakh. Let us explore -

Top Post Office Saving Schemes

1. National Savings Recurring Deposit 
2. National Savings Time Deposit 
3. Senior Citizens Savings Scheme 
4. Post Office Savings Account 
5. Public Provident Fund 
6. Sukanya Samriddhi Account 
7. National Savings Certificate
8. Kisan Vikas Patra 
9. Mahila Samman Savings Certificate
10. PM CARES for Children Scheme

1. National Savings Recurring Deposit (RD)

The National Savings Recurring Deposit Account (RD) is a popular savings scheme offered by the Indian government through post offices. You can invest a fixed amount of money monthly for a period you choose (typically 5 years). This type of saving offers a good maturity amount with guaranteed returns and compounded interest.

Key Features of RD

• Interest payable - 6.7% per annum (quarterly compounded)
• Easy to budget and build savings habits with fixed monthly deposits
• Compounding interest on your amount, allowing your money to grow faster.
• Perfect for achieving specific saving goals like purchasing electronic devices or home appliances, holidays, wedding expenses, etc.

2. National Savings Time Deposit (TD)

The National Savings Recurring Deposit Account is a popular savings scheme offered by the Indian government through post offices. You can invest a fixed amount of money monthly for a period you choose (typically 5 years). This type of saving offers a good maturity amount with guaranteed returns and compounded interest.

Interest Rates

• 1 year - 6.9%
• 2 years - 7.0%
• 3 years - 7.1%
• 5 years - 7.5 %

Key Features of TD

• Focuses on setting aside a larger amount at once.
• Assured returns on your money
• You can choose monthly, quarterly, or maturity based on your income needs.
• Perfect for building wealth over a timeframe longer than short-term goals.
• Can be used to create a regular income stream. It's a good option for retirees.

3. Senior Citizens Savings Scheme (SCSS)

The Senior Citizens Savings Scheme (SCSS) is a fixed-income investment scheme for Indian citizens aged 60 years and above. It offers attractive interest rates, safety, and convenience, making it a popular choice for retirees and senior citizens.

Key Features of SCSS

• Minimum Investment: Rs. 1000 
• Maximum Investment: Rs. 30 lakh 
• Lock-in Period: 5 years
• Interest Rate:  (8.2% annually as of January 2024)
• Complete safety for your principal amount and guaranteed interest income.
• Offers flexible deposit options. You can deposit a lump sum or make monthly instalments within the first year.
• With some penalties, premature withdrawal is allowed.
• Creates a predictable income stream during your retirement.
• The interest earned is taxable under the Income Tax Act, but a portion falls under Section 80C deductions.
• You can access your SCSS account at any authorised bank or post office across India.

4. Post Office Savings Account (SB)​​​​

The Post Office Savings Account (SB) is a simple and popular savings account designed to provide a secure and accessible way for individuals to save money and earn a modest interest rate on their deposits. SB can be opened by one or two adults only (Joint A or Joint B), a guardian on behalf of a minor, a guardian on behalf of a person of unsound mind, or a minor above ten years in his name.

Key Features of SB

• Minimum Opening Deposit: Rs. 500 for opening
• Minimum Balance: None required
• Interest Rate: Currently 4.0% p.a. for deposits up to Rs. 1 lakh, 3.5% p.a. above Rs. 1 lakh
• Interest Credited: Annually (can be credited to account on request)
• Tax Benefit: Interest earned tax-free up to Rs. 10,000 per year

5. Public Provident Fund (PPF)

The Public Provident Fund (PPF) is a popular long-term saving and investment scheme. You can invest for 15 years to enjoy tax-free returns and build a substantial retirement amount. Great for long-term financial planning and tax-saving benefits.

Key Features of PPF

• Minimum Investment: Rs. 500 per year
• Maximum Investment: Rs. 1.5 lakh per year
• Lock-in Period: 15 years
• Interest Rate: Currently 7.1% per annum (compounded quarterly)
• Partial withdrawal of your investment is allowed after 5 years; please read the conditions.
• Secure a loan against your PPF balance after 3 years (limited amount).
• Open and manage your PPF account at any post office across India.
• Transfer funds to your chosen nominee in case of any event.

6. Sukanya Samriddhi Account (SSA)

Sukanya Samriddhi Account (SSA) is a small savings scheme launched by the Government of India in 2015. It is a tax-saving scheme and encourages parents to save for their daughter's education and marriage. 

Key Features of SSA

• Eligibility - Designed for girls under 10 years
• Minimum Investment: Rs. 250 per year
• Maximum Investment: Rs. 1.5 lakh per year
• Lock-in Period: 21 years from the date of account opening
• Interest Rate: 8.2% per annum as of January 2024
• Regular or irregular deposits are allowed.
• Attractive Returns: Compounded interest for substantial wealth creation.
• Partial withdrawal is possible after 18 years (50% for education or marriage).
• Exempt from Income Tax on deposit, interest, and maturity amount.

7. National Savings Certificates (VIIIth Issue) (NSC)

Invest a lump sum for 5 or 10 years and get guaranteed returns with compounded interest paid at maturity. 

Key Features of NSC

• Minimum Investment: Rs. 1,000 (in multiples of Rs. 100)
• Maximum Investment: No limit
• Lock-in Period: Fixed term of 5 or 10 years
• Interest Rate: 7.7% per annum (compounded quarterly)
• Receive your invested principal and accumulated interest collectively at maturity.
• No Tax Deduction at Source (TDS).
• Can be used as collateral for loans from approved entities.

8. Kisan Vikas Patra (KVP)

The Kisan Vikas Patra is a small savings scheme launched by the Indian government in 1988. It is ideal for rural investors and those seeking short-term, high-growth returns. 

Key Features of KVP

• Minimum Investment: Rs. 1,000 (in multiples of Rs. 100)
• Maximum Investment: No limit
• Lock-in Period: 9 years and 5 months (115 months)
• Interest Rate: 7.5% per annum (compounded annually)
• Designed for farmers and rural investors.
• Doubles investment in 115 months (approximately 9.5 years).
• Ideal for short-term investments.
• Invest a single amount at the start.
• Interest is calculated on the original investment.
• Receive double your initial investment at maturity.
• Purchase KVPs at any post office in India.
• No early withdrawal is allowed.
• Taxable interest.

9. Mahila Samman Savings Certificate

The Mahila Samman Savings Certificate (MSSC) is a new small savings scheme designed for women and girls in India. It was launched in June 2023 as part of the Azadi Ka Amrit Mahotsav celebrations and is a one-time scheme available until March 2025.

Key Features of Mahila Samman Savings

• Minimum Investment: Rs. 1,000 (in multiples of Rs. 100)
• Maximum Investment: Rs. 2 Lakh
• Lock-in Period: 2 years
• Interest Rate: 7.5% per annum (compounded annually)
• Designed specifically for women and girls of any age.
• Earn regular interest payments monthly or reinvest for compound growth.
• Interest income qualifies for tax deductions under Section 80C.
• 40% of the balance withdrawal is allowed after one year; conditions apply.
• Early withdrawal (before one year) attracts penalties.

10. PM CARES for Children Scheme

The PM CARES for Children Scheme is an initiative launched by the Indian government in May 2021 to support children who have lost one or both parents or their legal/adoptive guardians due to the COVID-19 pandemic. It aims to ensure their care and protection through financial support, education, and healthcare.

Eligibility

• For children orphaned due to COVID-19 between March 11, 2020, and February 28, 2022.
• Age limit: Maximum 18 years at the time of losing parents/guardians.

Benefits

Financial

• ₹10 lakhs fixed deposit maturing at 18
• ₹20,000 monthly stipend for school (Class 1-12)
• Higher education financial assistance

Education

• School/residential institution admission
• Educational loans

Healthcare

• ₹5 lakhs health insurance cover
• Ayushman Bharat Scheme access

Additional Benefits

• Rehabilitation support in childcare institutions
• Counselling and mental health support
• Skill development training and career guidance

Why Should You Consider Investing in Post Office Saving Schemes?

Several factors contribute to the rising popularity of these schemes:

• Credibility: Backed by the Government of India, these schemes offer excellent security for your investments, minimising risk and ensuring peace of mind.
• Competitive Interest Rates: While not the highest in the market, Post Office Saving Schemes offer attractive interest rates compared to traditional banks, especially in rural areas.
• Accessibility and Convenience: With a vast network of post offices nationwide, these schemes are easily accessible even in remote locations.
• Tax Benefits: Several schemes offer tax deductions on investments and tax-free returns on maturity, making them an intelligent choice for tax-saving purposes.
• Flexibility: Different schemes cater to diverse needs and risk appetites, offering flexibility regarding investment amounts, tenures, and withdrawal options.