Post office schemes: 8 financial instruments offer assured return up to 8.2%

Are you a conservative investor who is looking to invest in some safe financial instrument? If the answer is 'yes' then you can, among other instruments, invest in a fixed deposit. Besides FD, one can also explore the prospect of investing in small savings instruments, or post office savings schemes.

These schemes include PPF (public provident fund), monthly income account, senior citizens savings scheme, post office savings account, National Savings Certificate (NSC), Kisan Vikas Patra (KVP) and Sukanya Samriddhi Account (SSA).

All of these financial instruments are safe and secure, therefore offer assured returns to investors. 

Although interest income that investors stand to earn on these instruments is somewhat closer to what FDs offer, these instruments also give income tax exemption up to ₹1.5 lakh in a year under section 80C of I-T Act.

Let us understand more on these schemes here.

These are some of the common small savings schemes

1. Public Provident Fund: It offers an interest of 7.1 percent per annum. The minimum investment one can make is ₹500 and maximum is ₹1.5 lakh in a financial year. There are withdrawal restrictions on PPF as a subscriber can take one withdrawal during a financial year after five years excluding the year of opening account. and the amount that can be withdrawn is upto 50 percent of balance at the end of the 4th preceding year, or at the end of preceding year, whichever is lower.

2. Monthly income account: It offers an interest of 7.4 percent per annum. The minimum amount that one can invest is ₹1,000. The maximum investment one can invest in a monthly income account is ₹9 lakh in single account and ₹15 lakh in joint account.

3. Senior Citizens savings scheme: It offers an interest of 8.2 percent per annum. There is only one deposit in the account in multiple of ₹1,000 not exceeding ₹30 lakh.

4. Post office savings account: It offers 4 percent per annum on individual/joint account. One needs a minimum of ₹500 for opening of account.

(Source: indiapost.gov.in)

5. Post office recurring account: It offers an interest of 6.7 percent per annum. One can deposit a minimum of ₹100 and there is no maximum limit of what one can invest in this.

6. National Savings Certificate: It offers an interest of 7.7 percent per annum compounded annually. One can invest a minimum of ₹1,000 and there is no maximum limit.

7. Kisan Vikas Patra: It offers an interest of 7.5 percent per annum compounded annually. One can invest a minimum of ₹1,000 and there is no maximum limit.

8. Sukanya Samriddhi Account: It offers an interest of 8.2 percent per annum. One can deposit a minimum of ₹250 and a maximum of ₹1.5 lakh in a financial year.