Latest and Revised Post office Interest Rates for Jul-16 to Sep-16

Latest post office interest rates Jul-16 to Sep-2016Latest and Revised Post office Interest Rates for Jul-16 to Sep-16

Last week, the Ministry of Finance announced latest interest rates for post office small saving schemes applicable for the period Jul-2016 to Sep-2016 (2nd Quarter). For the past few years, post office interest rates had minor changes, but investors could not digest high reduction in interest rates in Q1. In this article, I would provide latest updates on post office small saving schemes interest rates, which are effective from 1st July, 2016 to 30th September, 2016 and how you can get maximum out of post office saving schemes.

Also Read:  Latest Bank Recurring Deposit Rates for Jul-2016

Latest Post office Interest Rates for Jul-16 to Sep-16

While there are no changes in post office interest rates in Jul to Sep quarter compared to Q1, here is the snapshot of interest rates.

1) Though there is reduction in Post office schemes in Q1, I feel some of these schemes are still good even  now.

2) None of the other saving schemes would give highest interest rates that come from PPF. PPF is the best option to save income tax as well as to get tax free returns. Though it has maturity of over 15 years, this is considered as one of the best option for retirement savings.

3) It offers highest returns for Sukanya Samriddhi Account Scheme. One can save in their girl child till 14 years of age and post that this scheme would accumulate till girl reaches age of 22 or you can withdraw earlier based on certain conditions.

4) See the compounding and actual annual return column. Some of the schemes are compounded quarterly, means yearly, you would get higher returns compared to interest rates indicated.

5) If you want to double your money, you need to deposit for at least 115 months in the bank. However, in post office KVP, it takes 110 months only. KVP is beneficial compared to bank FD schemes.

6) Post office FD rates are ranging between 7.1% to 7.9%, however they are compounded quarterly. Means the effective annual return is 7.29% to 8.13%. Banks are offering at 6.5% to 7.5% interest rates. Hence, for some of the FD tenures, bank FD interests are better now.

7) Invest part of your savings in post office schemes which are offering higher returns instead of investing in bank FD’s.

8) If you are a retired person, investing in post office monthly income scheme (POMIS) is one of the best way to get safe monthly income.

9) If you are low risk taker and planning to invest money to save tax,  NSC is one of the best option to invest.

10) If you are planning to save money every month, you can consider post office recurring deposit which offers upto 7.6% annualized returns.

Here are the Latest and revised Post office Interest Rates for Jul-16 to Sep-16

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Latest and Revised Post office Interest Rates for Jul-16 to Sep-16

Suresh KP


  • Ajay Agrawal

    Suresh Sir
    Kindly Suggest ?

  • hitesh

    Thank ypu for sharing this updated information…

  • Ajay Agrawal

    Hello Suresh Sir,
    I am a regular reader of your articles, again i need suggestion from your side kindly help.

    Next month i will get about 20 lakh Rs from my partner for leaving the partnership business and i don’t have any plans to invest it, so kindly suggest.

    For next 8-10 years i do not have any big requirements, as i have other business to fulfill it.
    Right now i am investing in different MFs advised by you (12000/Month)

    what should i do?
    Should i invest in property?
    Should i invest in Stock Market?
    or in MFs?

  • surinder gupta

    i like the article and keep the investos update about interest rates in post offices schemes.

  • Ajith N

    Dear Sir,

    I have started a 5 yr RD in post office from October 2014. I am of the impression that my deposit will earn with the old rate throughout the tenure. Is it true? Or the new quaterly aanounced rate is applicable to the old investment also?? Please clarify.   


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