SBI RD or Post Office RD

If you want to get safe and guaranteed returns by investing a fixed amount every month, then Recurring Deposit (RD) can be a good option. Unlike mutual funds or stock market, it is not affected by market fluctuations and gives fixed returns on investment.

If you deposit Rs 10,000 every month for 5 years, then post office RD and State Bank of India Both RDs can help you in creating a good fund. However, due to difference in interest rates, the amount received on maturity will vary.

Post Office RD vs SBI RD

Which RD will give more returns?

Based on the current interest rates, if you invest in Post Office RD, you will get around Rs 7.14 lakh after 5 years, while in SBI RD you will get around Rs 7.02 lakh. In this way, by choosing Post Office RD, the investor can get around Rs 12,100 more than SBI RD. However, this calculation is based on the current interest rates. Returns may also change due to changes in interest rates in future.

What is RD account?

Recurring Deposit (RD) is a savings scheme in which you deposit a fixed amount every month. On completion of the stipulated period, you get interest along with the deposited amount.

Special features of Post Office RD

• Account can be opened with only Rs 100 per month
• There is no maximum investment limit
• The account has a tenure of 5 years
• If needed, the account can be closed after 3 years
• But if you close the account before completion of 5 years, you can get savings account interest rate instead of RD interest.

Special features of SBI RD

• RD account can also be started in SBI with a monthly deposit of Rs 100.
• Penalty is imposed for not depositing the installment on time
• If 6 consecutive installments are not paid, the account can be closed prematurely.
• A penalty of Rs 1.50 per month is imposed on every monthly installment of Rs 100 on RD for up to 5 years

If your goal is to get high returns by investing regularly for 5 years, then according to the current interest rates Post Office RD can prove to be a better option than SBI RD. It is not only giving higher interest but can also provide more amount on maturity.

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