The Post Office Time Deposit (TD), commonly known as a Post Office Fixed Deposit, remains one of the safest investment avenues in January 2026. Backed by a sovereign guarantee from the Government of India, it offers fixed, predictable returns that are immune to market volatility.
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For the January–March 2026 quarter, the government has maintained the interest rates, keeping the 5-year tenure at a highly competitive 7.5%.
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1. Interest Rates for Q4 (Jan–March 2026)
The interest is calculated quarterly but payable annually. This compounding effect significantly boosts your final maturity amount.
| Tenure | Interest Rate (% p.a.) |
| 1 Year | 6.9% |
| 2 Years | 7.0% |
| 3 Years | 7.1% |
| 5 Years | 7.5% |
2. The ₹1,00,000 Investment Breakdown (5-Year Plan)
If you invest ₹1,00,000 in the 5-year Post Office FD today, here is how your money grows:
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Principal Amount: ₹1,00,000
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Annual Interest Rate: 7.5% (Compounded Quarterly)
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Total Interest Earned: ₹45,329
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Maturity Value: ₹1,45,329
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3. Why Choose Post Office FD over Bank FDs?
While many private and public sector banks offer competitive rates, the Post Office FD has specific advantages in the current 2026 fiscal landscape:
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Sovereign Guarantee: Unlike bank FDs, which are insured only up to ₹5 lakh by DICGC, the entire principal and interest in a Post Office FD are 100% secured by the Government of India.
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Tax Benefits: The 5-year tenure qualifies for a tax deduction of up to ₹1.5 lakh under Section 80C of the Income Tax Act (available under the Old Tax Regime).
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Monthly Interest Payout Option: You can link your FD to a Post Office Savings Account to receive annual interest payouts automatically.
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Accessibility: You can start with as little as ₹1,000.
4. Key Rules for 2026
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Eligibility: Any resident Indian adult, up to three adults (jointly), or a minor above 10 years (in their own name) can open an account.
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Premature Withdrawal: Not allowed before 6 months. If withdrawn between 6–12 months, only the Post Office Savings Account interest rate (currently 4.0%) will apply.
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TDS (Tax Deducted at Source): If your total interest across all Post Office FDs exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year, TDS will be deducted at 10%.
Also Read | How to Track PAN Card Misuse 2026: Check Loans & Report Fraud
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