The State Bank of India offers this wonderful savings plan for the Har Ghar Lakhpati scheme. This kind of recurring deposit (RD) allows you to save a small amount every month and get back more than ₹1 lakh after the maturity period. This scheme is intended for people who wish to accumulate a considerable amount over time through regular contributions to a risk-free savings policy.
How does a Recurring Deposit (RD) work ?
A Recurring Deposit is like saving money, once developed into a habit, which pays well. You choose a fixed amount to deposit every month, and at the expiry of the stipulated period, you get back that amount along with interest. Just think of it as a digital piggy bank but with interest.
This scheme is flexible in that you can choose any period between 3 years to 10 years to suit your purpose.
What Interest Will You Earn?
SBI is offering attractive interest rates under this scheme.
The regular customers can earn interest of up to 6.75% per annum.
Senior citizens (60 years and above) will earn interest at the rate of up to 7.25% per annum.
This shows that your money is not just lying idle in the bank but is actually multiplying every month.
Who Can Open This Account?
This plan is suitable for all Indian citizens.
One may choose to open the account single-handedly or jointly with any family member.
Parents or guardians can also open an RD account with their children, as long as the child is over 10 years old and can sign properly.
The above scheme is considered a secure as well as reliable option when planning for your own future or your child’s education.
Do the Taxes Apply to the Interest Then?
Interest earned on RD counts as revenue and might attract tax.
There’s no tax deduction if the overall interest in a financial year is less than ₹40,000.
It is ₹50,000 for senior citizens.
If your interest income exceeds these limits, then 10% TDS (Tax Deducted at Source) shall be deducted by the bank as applicable automatically.
By what means are you going to avoid TDS if you fall outside taxation?
A person earns much less than the taxable amount defined in India; then he need not suffer the TDS deduction by simply submitting the:
Form 15G for regular account holders
Form 15H for senior citizens
These forms act as disclaimers that a person’s income does not cross the limit where taxes can be levied upon them, and once these are submitted, the bank won’t do any tax deduction from the interest earned upon that person’s account.
SBI’s Har Ghar Lakhpati scheme is a way to save small amounts each month in order to build a big fund. Starting from just ₹593 a month, make your way toward ₹1 lakh and more—all without stress, risks, or complex investments. You may consider this scheme if you are someone who prefers to save at a steady pace with guaranteed returns.
