How returns of Post Office Schemes outperforming bank FDs

In the recent two months, the RBI increased interest rates by 90 basis points in two tranches, which led to an increase in the interest rates on short-term deposits by banks and post offices. Interest rates on bank fixed deposits are lower than those on post office plans in comparison. The interest rates on post office schemes like the Senior Citizen Savings Scheme (SCSS), Public Provident Fund (PPF), and Sukanya Samriddhi Yojna are much lower than the interest rates on fixed deposits offered by leading banks like SBI, ICICI, HDFC, Axis Bank, PNB, BoB, and others.

Therefore, consumers seeking higher returns than bank FDs in the current interest rate environment may want to think about the following post office savings plans for long-term investments.

Senior Citizen Savings Scheme (SCSS)

Among NPS and PMVVY, the Senior Citizen Savings Scheme (SCSS) is a popular investment choice for senior citizens looking to outperform fixed deposits. It is a small savings scheme. An SCSS account can be opened by senior citizens, retired civil servants who are over 55 but under 60, and retired military people who are over 50 but under 60.

Public Provident Funds (PPF)

Due to its exempt-exempt-exempt (EEE) status, PPF is one of the most well-liked investment solutions for long-term investors. A PPF account can be opened by a single resident adult Indian or a guardian on behalf of a juvenile or someone who lacks capacity with a minimum deposit of Rs 500 and a maximum yearly commitment of Rs 1.5 lakh. Investors should be aware that deposits qualify for section 80C of the Income Tax Act deductions. Investors can currently earn 7.1 percent annual compound interest on deposits with PPFs, which have a 15-year maturity period.

Sukanya Samriddhi Yojna (SSY)

The goal of this post office programme is to help parents save money for their daughter's future. According to the phrase, guardians may open SSA accounts on behalf of their girl children who are younger than ten, however only one account may be opened in India in a girl's name for a household with up to two daughters.

A minimum deposit of Rs 250 and a maximum deposit of Rs 1,50,000 are required to start an SSA account, and deposits may be made for up to 15 years after the account is first opened. Under Section 80C, Sukanya Samriddhi Account deposits are tax deductible up to Rs. 1.5 lakh annually.

When choosing such policies, one must be aware and cautious because insurers may also provide other types of life insurance plans under the guise of income insurance.