The Post Office Fixed Deposit means a lot to me, going above and beyond just saving money. It's a tradition in my family that goes back generations. I remember going to the post office with my grandparents - the familiar routine, the scent of ageing paper, and the friendly faces behind the counter evoke a sense of nostalgia and belonging.
Moreover, the Post Office Fixed Deposit isn't just a repository for funds; it's a symbol of security and stability in an ever-changing world.
My grandparents trusted the Post Office Fixed Deposit because it was safe and reliable. They taught me the importance of saving for the future through schemes such as these, and those lessons stick with me today.
Their stories of financial discipline and the security provided by the Post Office Fixed Deposit have shaped my own approach to money management.
Now, when I go to the post office, it feels like I'm continuing a family tradition. It's like a safety net for my savings.
As per Chartered Accountant Abhay Asknani, ‘In 2024, the Department of Posts, under the Ministry of Communications of the Government of India, provides fixed deposit schemes with appealing interest rates for durations spanning one to five years. These rates fluctuate between 6.90 per cent and 7.50 per cent. Interest accrues annually, and individuals can start with a minimum deposit of ₹1,000, without any upper limit.’
Abhay explains how to invest in the Post Office Fixed Deposit scheme.
A Post Office Fixed Deposit can be initiated at any post office across India through both online and offline channels.
Online Procedure:
To open a Post Office Fixed Deposit account online, individuals can utilise internet banking services by following these steps:
• Access the official e-banking portal of the post office at ebanking.indiapost.gov.in.
• Log in to the portal using your registered credentials (ID and password).
• Navigate to the 'Service Request' section under the 'General Services' tab.
• Follow the on-screen prompts and initiate the Post Office Fixed Deposit opening request by selecting the 'New Request' option.
Offline Process:
Alternatively, one can opt for the offline method by visiting the nearest India Post branch. Upon arrival, individuals can obtain the requisite form to open a new Post Office Fixed Deposit account. After completing the form and providing copies of necessary documents, submit them to the post office authorities. They will then guide you through any additional steps required to finalise the process.
Who Can Open A Post Office Fixed Deposit Account?
• Indian residents have the option to handle such investments independently or jointly.
• Minors also qualify for participation in the Post Office Fixed Deposit scheme, overseen by their legal guardian.
However, Non-Resident Indians (NRIs), trusts, companies, and other entities are not permitted to engage in fixed deposit investments through the Post Office.
Taxation Of Post Office Fixed Deposit
The Five-Year Post Office Fixed Deposit or National Savings Term Deposit is eligible for tax relief under section 80C. Depositors can avail of a tax deduction of up to ₹1,50,000 on their deposit.
It's important to note that the interest earned on Post Office Fixed Deposits is subject to taxation for depositors. Individuals below the age of 60 are liable to pay tax on the interest earned. However, senior citizens aged 60 and above enjoy an exemption on interest income up to ₹50,000.
Loan Against Post Office Fixed Deposit
When taken against an FD of India Post Office, one can avail a loan of up to 90-95 per cent of the fixed deposit amount. The interest charged on loans against FDs are typically low and are around 2-3 per cent higher than the fixed deposit interest rate.