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  • Difference Between LIC and Post Office Recurring Deposit

    A Recurring Deposit is a financial instrument through which individuals can deposit a fixed amount of money every month for a fixed period of time. The money deposited would accrue interest over the time period of the deposit, and the interest would be payable over a monthly, annual or end of maturity basis.

    A Recurring Deposit or RD, as it is commonly known as, is a good alternative for those who do not have a large amount of capital to invest in a Fixed Deposit. As compared to a Fixed Deposit, which requires a one-time deposit of a sum not less than Rs. 10, 000, RD allows for a minimum deposit of Rs. 500, with each subsequent deposit made to be in multiples of 100.

    In this way, an RD allows for individuals to be able to budget as well as save for the future. A Recurring Deposit also pays out the same rate of interest as a Fixed Deposit, depending on the tenure of the deposit.

    An RD can be for tenures ranging from 6 months to a maximum of 10 years.

    The LIC or Life Insurance Corporation of India is a company that was instituted in the year 1956 with the aim of providing life insurance policies to the Indian people. The company is now the largest provider of life insurance in India, with assets worth over $ 230 billion.

    The Post Office, also known as India Post, was set up in the year 1774 by the British Empire. With a network spanning the length and breadth of the country, the Post Office runs services that include letters, parcels as well as financial services like the Public Provident Fund, life insurance and savings accounts and recurring deposits.

    LIC Recurring Deposit

    The LIC Recurring Deposit scheme is a financial tool that enables individuals to save money and earn from their savings. The LIC RD is known as the Jeevan Saral plan and is a recurring deposit plan that allows individuals to deposit a sum of money either monthly, quarterly, half-yearly or annually for a fixed duration, on which they will receive a pre-determined interest.

    Individuals who wish to invest in the LIC Jeevan Saral can do so by opening an account with the LIC, after which they can select the tenure of their deposit. This can range between a minimum tenure of 10 years and a maximum of 35 years.

    This is a long term deposit plan that offers individuals attractive rates of interest, as well as the chance to decide the premium amount. If the individual survives till the deposit matures, he stands to receive 250 times the deposit, which is the maturity sum along with loyalty additions. In case the investor passes away before maturity of the term, a guaranteed return of investment of 250 times the initial amount deposited will be transferred to his heirs.

    Individuals investing in the scheme also stand to benefit from income tax exemptions, as the premium amount as well as the amount deposited is exempted from income tax under Section 80c.

    The LIC Jeevan Saral scheme has another advantage in that it is auto renewed. If an individual forgets to claim the premium upon maturity, the scheme is renewed for an additional 10 years, and he will receive additional premium over the extended period of time.

    The financial future of family members can be safeguarded from an early age through this scheme, as the minimum age for depositors is 12 years of age.

    Elderly investors stand to receive an additional amount as premium, with the minimum amount received as premium guaranteed being Rs. 400 a month.

    In case the individual wishes to opt out of the scheme, he may do so partially after a period of 3 years from the commencement of the scheme.

    To incentivize investors to invest in long term policies, LIC offers a loyalty addition bonus for every year above a 10 year deposit tenure. This amount will be handed over to the investor upon maturity of the deposit.

    Post Office Recurring Deposit

    The Post Office Recurring Deposit scheme is a 5 year RD scheme. Under this, investors stand to receive a guaranteed sum assured upon maturity of the premium deposited over the term.

    The Post Office Recurring Deposit scheme allows investors to make an initial deposit of Rs. 10/- and subsequent deposits in multiples of 5, with Rs. 10/- being the minimum amount. The deposits have to be made on a monthly basis, with the deposits accruing interest at the rate of a Foxed Deposit scheme.

    Investors who choose to would like to invest in the Post Office’s RD scheme can open as many accounts as they desire at any of the post offices in the country. Individuals can also open accounts in the names of minors, with the minimum age for opening an RD based account being 10 years.

    Upon maturity, the investor will receive a Sum Assured along with the interest for the period, i.e 5 years.

    Investors can also choose to open a joint account for their Post Office RD schemes, and can choose to transfer these accounts to any post office within the country.

    Comparison Between LIC Recurring Deposit and Post Office Recurring Deposit

    Given below are the differences between the Life Insurance Corporation’s recurring Deposit and the Post Office Recurring Deposit scheme:

      LIC RD Post Office RD
    Tenure Up to 35 years Up to 5 years
    Minimum amount Rs. 250 Rs. 10
    Subsequent premium amount Multiples of Rs. 50 Multiples of Rs. 5
    Loan against policy Available Not available
    Rate of interest Not guaranteed- loyalty addition provided 8.4% per annum, with interest compounded per quarter
    Tax benefit Yes, under Section 80c up to Rs. 1, 00, 000 (premium amount) No benefit
    Premature Surrender Yes, 80% of Monthly Sum Assured after 3rd year, 90% after 5th year Yes, but interest penalty charged
    Recurring Deposit - Sitemap

    Customer Reviews

  • Page 1 of 50 1 2 3 4 5
    • Kotak Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 5.0/5 "Blown Away!"
      The personal loan service was prompt from Kotak Mahindra, but within the time they process my personal loan application. I have arranged the required loan amount so that was the reason I haven't got the loan with kotak. The rate of interest is nominal with Kotak mahindra.
      Was this review helpful? 0
      , faridabad
      Reviewed on Sep 23, 2017
    • Punjab National Bank Home Loan
      "Be consistent in the details"
      PNB HOUSING FINANCE LIMITED
      0.5 1.0/5 "Really Bad"
      PNB housing finance was not a good one for me, though they were okay in the process. They have charged me 100% of the processing fees when I was supposed t be charged only 50%. I had to pay more than 11k. They need to be consistent in the whole process.
      Was this review helpful? 0
      , vadodara
      Reviewed on Sep 23, 2017
    • LIC Life Insurance
      "Jeevan key saat be or Jeevan key baath be"
      LIFE INSURANCE CORPORATION OF INDIA
      0.5 4.0/5 "Great!"
      I have taken a life insurance from LIFE INSURANCE CORPORATION OF INDIA. Its a term insurance of 10 years. The annual premium is 25000 which i used to pay through cheque. After the completion of my maturity period i will get 4 lakhs. And in every 2 years i will get 30000.
      Was this review helpful? 0
      , allahabad
      Reviewed on Sep 23, 2017
    • Bank Bazaar Personal Loan
      "Good service"
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      Bank bazaar gives a simplified data to the customers, It is easy to compare and choose the product with the help of bank bazaar website. The website of bank bazaar is easy to use and user friendly. The bank bazaar customer service has reached me within a hour time after I gave my requirement bank bazaar website,
      Was this review helpful? 0
      , srinagar
      Reviewed on Sep 23, 2017
    • ICICI Bank Personal Loan
      "Average service"
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      In concern to my perosnal loan, I got a quote in the beginning from ICICI bank but after that few changes were made in the rate of interest so that was the reason I haven't got the loan with ICICI bank. The Customer service is not up to the mark and they haven't fulfill my requirement . The rate of interest was nominal when compared with others, The follow up need to focused with ICICI executives.
      Was this review helpful? 0
      , srinagar
      Reviewed on Sep 23, 2017
    • SBI Saving Account
      "Not satisfied"
      STATE BANK OF INDIA
      0.5 2.5/5 "Just OK"
      I am not happy with State Bank of India. It is a salary account and there are no benefits as such. When ever I have applied for a loan they have not processed the same. The online banking is also not good and overall the bank is not recommendable from my end.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Bank Bazaar Home Loan
      "Satisfactory"
      PNB HOUSING FINANCE LIMITED
      0.5 4.0/5 "Great!"
      The services at Bankbazaar has been good and the experience is satisfactory. I faced no issues or inconvenience faced. The website is also good and it is very much informative and very easy to browse through and choose the best bank in the market.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Punjab National Bank Home Loan
      "Overall good"
      PNB HOUSING FINANCE LIMITED
      0.5 4.5/5 "Excellent!"
      PNB housing finance was very much cooperative and they collected my documents and processed my papers. The disbursement also happened as earlier as possible. The interest rate and processing charges is normal and the overall experience is perfect.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • review Consumer Durable Loan
      "Good service"
      BAJAJ FINSERV
      0.5 4.0/5 "Great!"
      I got the refrigerator and laptop with the help of Bajaj Finserv Consumer durable loan. There is no rate of interest with the Bajaj consumer durable loan but the late fee and the charges are high with BAJAJ. I have closed the loan within 9months of time after getting the fridge and laptops. I payback the loan amount through ECS mode.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Universal Sompo Health Insurance
      "Good policy"
      UNIVERSAL SOMPO GENERAL INSURANCE
      0.5 3.0/5 "Satisfactory"
      I can say it is an average policy to use and I got the Universal sompo health insurance policy from past 2years. I pay Rs.4000 to renew the policy. This policy covers only 3 members which is myself, my spouse and my son. I never had any claim experience yet. The medical coverage is good with this policy it covers Upto 2lakhs.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • LIC Life Insurance
      "Good policy"
      LIFE INSURANCE CORPORATION OF INDIA
      0.5 4.0/5 "Great!"
      I got the life insurance policy with LIC around 5years. This policy has the tenure of 10years. I pay the premium of Rs.1200 in every 3months once. I pay the premium using LIC website. The policy coverage and the plan benefits are good with this policy.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • SBI Saving Account
      "Good banking service"
      STATE BANK OF INDIA
      0.5 4.0/5 "Great!"
      I use the State bank of India savings account for more than 3years. I don't use their net banking and their mobile application . The customer service is average with SBI, The rate of interest is nominal with SBI. I am satisfied banking with SBI.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • HDFC Bank Credit Card
      "Good "
      HDFC BANK
      0.5 4.0/5 "Great!"
      The good thing about HDFC Bank is they use their own servers for the transactions and payments on the card. But I guess they have too many customers that the servers are slow. I hold a credit card and the offers are good and the services are also good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Saving Account
      "Good account to use"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      I have started using Kotak mahindra salaried account for past 10months. I use the net banking and the mobile application which is easy to use and user friendly. The customer service is good with Kotak mahindra. They have offered me a personal loan and a credit card but I have got only personal loan.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • ICICI Bank Credit Card
      "Average "
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      ICICI Bank is also not up to the mark in the credit card. The one thing I do not like is the bank uses the third party servers for payments and that is not safe. The transaction needs to be more secured. There are charges for the card and in all not that happy to use it.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Bank Bazaar Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      For more than a year I am with bank bazaar. The bank bazaar customer service has reached me within 2hours of time. The response was very quick and fast from bank bazaar.The website of bank bazaar is easy to use and user friendly. I would say bank bazaar rendered very good service.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • SBI Cards Credit Card
      "Need more offers and features"
      SBI CARDS
      0.5 3.0/5 "Satisfactory"
      SBI is average on the credit card services. The bank could work on their service and the overall offers and also on the credit limit. When compared to the other banks they could not be recommendable. They could be more proactive and friendly.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Credit Card
      "Excellent services"
      KOTAK MAHINDRA BANK
      0.5 5.0/5 "Blown Away!"
      Kotak Mahindra bank is also good in the credit card services. The offers are good and the credit limit is also excellent. They use their own servers to make a payment and that is very secured. It also works fast. The services and response at the customer care is good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      The Kotak mahindra executives took around 3week time to disburse my loan amount. The rate of interest which they have offered was high when compared with others banks. The required loan amount was not disbursed and I am not satisfied with the loan amount.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • HDFC Bank Saving Account
      "Average"
      HDFC BANK
      0.5 3.0/5 "Satisfactory"
      HDFC Bank is also average in the savings account. I hold a savings account and they could be more professional and the bank will not be recommendable. They are not up to the mark when compared to Kotak Mahindra bank. There are charges involved as well.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
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