Pros & Cons of Investing in Post Office Fixed Deposit
Eastern Eye Staff
The Indian Department of Posts is considered the backbone of India and is an old government institution running like clockwork. The department has made its reach more diversified by venturing into the domains of insurance, investment, money transfer and retail services. A post office fixed deposit is a good way to invest, earning returns more than banks give you today.
Advantages of a Post Office Fixed Deposit
With bank and NBFC interest rates hitting rock bottom, you may not find avenues to invest your money. However, you can invest in a fixed deposit scheme offered by NBFCs like Bajaj Finance and find out more at Finserv MARKETS. Another way to invest is via the Department of Posts in India, offering you high returns in terms of interest rates. Here are advantages of a post office fixed deposit:
- Low Minimum Amount – The minimum is only ₹1,000.
- High Interest Rates – Currently, the Post Office FD interest rateis high, far more than banks and some NBFCs give you. This ensures you high returns.
- Premature Withdrawal – You can withdraw your FD before maturity.
Disadvantages of a Post Office Fixed Deposit
Although you will see high returns on a post office fixed deposit if you use a post office FD calculator, some people find there are disadvantages in opening a post office FD:
- The maximum tenure of a post office FD is five years, and you cannot opt for a longer tenure.
- If you opt for a premature withdrawal, you may be charged a fee.
- Most services rendered are not online, and this may be a disadvantage to many.
- Banks offer more flexible tenures of FDs than post office FDs, offering only tenures of 1, 2, 3 and 5 years.
- Interest payout is only annually, whichever tenure you choose.
Opt for an FD
You can opt for an FD that strikes a balance between a bank FD and a post office FD with one at Finserv MARKETS. Explore attractive options and interest rates, plus value-added services.