PPF vs Post Office RD: Determine which of these two is better for you as large funds can be quickly created through both programmes

You can invest in the Public Provident Fund (PPF) and Recurring Deposit (RD) schemes if you’re seeking for a modern investment strategy that will keep your money safe and earn you better income

Interest rates for RDs at post offices increased as of October 1. You will now receive 6.7% yearly interest on this. PPF, however, receives 7.1% interest. You can easily build a sizable portfolio by making regular monthly investments in these plans. We’re letting you know about these programmes so you may make an investment based on your needs.

PPF receives interest at 7.1%.

This scheme is available at any bank or post office.

PPF accounts cost only Rs 500 to open. The annual maximum deposit into this account is Rs 1.5 lakh.

This 15-year plan cannot be terminated in the middle of it. However, after 15 years, it may be renewed for another 5 years.

A loan may be taken out against this account after three years, but it cannot be closed before 15 years. From the seventh year, anyone who desires to may, in accordance with the rules, take money from this account.

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Every three months, the government evaluates interest rates. These interest rates could change in value. On this account, interest is now being paid at a rate of 7.1%.

By making an investment in this plan, you are eligible for a tax break under Section 80C of the Income Tax Act.

What kind of return can you expect from a 15-year investment?

According to this plan, if you put $1,000 aside each month for 15 years, you’ll have almost $3.20 lakh. You will therefore receive interest totaling more than Rs. 1.40 lakh.

On RD, interest rates are 6.7%.

On Post Office RD, interest is now paid at a rate of 6.7% per year. A particular kind of tiny savings plan is RD. In addition to the post office, anyone can open an account with a bank.

Every month, you can contribute as little as Rs 100 in the RD plan. Additionally, you may deposit any sum in multiples of 10 above and beyond this. The maximum deposit amount has no upper limit.

Additionally, one or more RD accounts may be opened. The names of young children may also be used to open this account. If you are 10 years old or older, you can use it on your own. A joint account may also be opened by three people.

You may save a lot of money with RD. When it matures after five years, you will have a sizable sum in your palm if you continue to deposit a set amount into it each month as your salary arrives. You can, however, request an additional 5-year extension after the first five. This can be done as many times as you like.

What kind of return can you expect if you invest Rs 1,000 per month for 15 years?

If you invest Rs. 1,000 per month for 15 years according to this plan, you will receive about Rs. 3.03 lakh. You will therefore receive interest totaling more than Rs. 1.23 lakh.

Where should I make my investments?

The PPF scheme is good if you can invest your money for 15 years. 7.1% interest is being paid on it. While RDs are receiving interest at a rate of 6.7%. In contrast to PPF, the lock-in duration is likewise substantially shorter at 5 years. Based on your financial position, you can pick the best plan for you.