On one hand, this has reduced the EMI of the loan, on the other hand, the return on FD has also decreased. Senior citizens have suffered the most due to the reduction in interest on FD. In such a situation, if you are also troubled by the low interest on FD, then there is no need to take tension. We are telling you about a great saving scheme of Post Office. The name of that scheme is Post Office Time Deposit (TD). By investing in this scheme, you can get more interest than bank FD. Let’s know about this special scheme.

What is Post Office Time Deposit (TD) Scheme?

This is a fixed deposit scheme run by the post office. You can invest in it for 1,2,3 and 5 years. This scheme is backed by the government, so it is completely safe and reliable.

Interest Rates on Post Office Time Deposit Scheme 

Who can invest? 

Any adult citizen of the country can invest in this scheme. At the same time, 3 adults can invest in it together by opening a joint account. Parents can invest in this investment scheme in the name of their children. 

How much can you start investing with? 

You can start investing in this saving scheme with ₹1000. You can increase the amount as per your wish in multiples. There is no maximum investment limit. Interest is paid annually. Investing in 5-year TD is eligible for tax exemption under Section 80C of the Income Tax Act.

The account can be extended within the prescribed time from the date of maturity:

• 1 year TD: in 6 months
• 2 year TD: in 12 months
• TD for 3 and 5 years: in 18 months

Extension can be requested at the time of opening the account itself. The application form and passbook for extension has to be submitted to the concerned post office. The original interest rate which was applicable on the day of maturity will be applicable for the extension period.

Premature withdrawal of money 

Withdrawal cannot be made before 6 months from the date of opening the account. If the account is closed between 6 months to 1 year, the Post Office Savings Account interest rate is applicable. 

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The biggest reason for this is that the returns in the stock market are much higher than the savings account or FD of banks. However, sometimes people also face problems.

People lack information

For example, if you want to invest to secure the future of your children, then many easy and popular options will be available in banks or post offices. Be it Sukanya Samriddhi Yojana or many FD-RD options, one can find the means of investment as per the goal. In case of stock market, such specialized product is not available. However, you can easily invest in the stock market for your children. For this you just need to have information.

Demat account is most important

The most important thing to invest in the stock market is Demat account. Meaning, if you open a demat account for your child, then all your problems end here. So we just have to see whether we can open a demat account for children or not? If it can be done then what is its process?

Can be opened in this way

Demat account opened for children is called minor demat account. There is no minimum age limit for opening a minor demat account. This means that no matter how small your child is, you can invest in shares because the facility to open a demat account is available. The thing to note here is that minor demat account cannot be opened like a joint account, rather they have to be opened with a parent or guardian.

Documents required for Minor Demat Account

• PAN of parent or guardian.
• Address proof of parent or guardian. For this you can give Aadhaar, passport, driving license, voter ID etc.
• Child’s birth certificate. Bal Aadhaar, school transfer certificate or board mark sheet can also be used.
• The parent will have to complete the KYC process of SEBI. There should be no restrictions on the stock market on them.
• Bank account in the name of the child.

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