To save for the rainy day, people invest in several schemes which give them moderate but fixed and guarantee return. Some of the schemes which provide these guarantee returns are Post office schemes, Pension Schemes and Public Provident Fund.Post Office Schemes
This is offered by the Department of Post, Government of India. There are several schemes where people can invest. Since they have pan India reach with around 1.5 lakh branches and 90% of them being in the rural area, they offer financial instruments through which people can make savings and investment. The schemes are,
Government of India has rolled out tow pension schemes for the people of India viz., National Pension System (NPS) and Atal Pension Yojna (APY).
APY: To carter to the workers of the unorganised sector, which constitute 88% of the total work force, who do not have a formal pension scheme, the government of India have launched this pension programme. Through this the contributor would get a fixed guaranteed monthly income, depending upon the contribution one is making and the time for which the investment is being made. The monthly income varies from Rs. 1000/- to Rs. 5000/-. The minimum age for joining is 18 and maximum is 40. Government contribution of up to Rs. 1000/- per annum is available to this scheme for those who joined between June-Dec 2015 and shall continue till March 2020.
NPS: For all others, government has launched Voluntary National Pension Scheme (NPS) for all citizens of India. It is regulated by PFRDA and NPST is the owner of all assets under NPS. Anyone can join this scheme, either through their employer (if the employer is a part of NPS) or individually. There is no limit on the amount invested (minimum amount is Rs. 250/-), however, you get a rebate for up to Rs. 50,000/- towards tax calculation, invested under this scheme. The investor shall have two investment choices and the scheme preferences can be changed twice a year and the Pension Fund Manager can be changed once a year.Public Provident Fund Scheme
The scheme initiated by the Government of India in 1968 to encourage small savings is most popular among all type of people working, whether private, public or government. The benefit here is the fixed rate of interest which is more than any other scheme and the guarantee of the government. Ay amount can be invested (minimum is Rs. 500/- per annum), however, the interest is payable only on an amount of up to 1.5 lakhs, per annum. Any invested amount, more than this shall not earn any interest. These are also tax-free accounts where the amount is not taxed at any point of time. The PPF account can be opened with any bank/ post office.