In the testing times of COVID-19 pandemic earning and mere savings may not be enough to deal with the crisis. Investment has become a necessity due to draining income sources and what could be better than getting high returns on your planned investment.
If you are planning to invest your money, the Post Office’s Small Saving Schemes can be a viable option for making the investment. There is a sovereign guarantee on the deposited amount and hence providing safety and security to it. National Savings Certificate (NSC) is one of the many Small Saving Schemes of the Post Bank offices. Under NSC, the depositors will get an interest rate of 6.8 per cent on their deposited money in Post Office banks.
Under the NSC scheme, a depositor can get a better return compared to other bank’s Fixed Deposit (FD) or RD. In the NSC scheme, 6.8 per cent of interest on depositor’s money will be compounded annually. The depositor will be able to withdraw the money after the completion of the 5-year maturity period. The depositors can also continue the deposit for another period of five years.
In this scheme, the depositor will have five investment options. The NSC is currently available in denominations of Rs 100, Rs 500, Rs 1,000, Rs 5,000 and Rs 10,000. The depositor can invest in this scheme by purchasing certificates of different values. The minimum investment should be 100, however, there is no maximum investment limit in this scheme.
If a depositor invests Rs 15 lakhs in this scheme, he will get Rs 20.85 lakhs (benefit of about 6 lakhs) in 5 years at 6.8 per cent interest rate. Under Section 80C of the Income Tax Act 1961, the tax deduction is also available on investments in NSC upto Rs 1.5 lakh per annum.