Saturday, June 30, 2012

Savings And Investment Scheme Guide For Indian Poor And Middle Class:National Savings Cerificate(Series VII & IX))

What Scheme Mean?
The National savings certificate is a popular and safe small savings instrument that combine tax-savings with guaranteed returns.This scheme is backed by the government, and is one of the safest investment options available at post offices.

Eligibility
As to be resident of India to buy these certificate.

Entry Age
No age limit

Investment
Minimum:Rs100 per annum
Certificates are available in denominations of Rs100,Rs500,Rs1000,Rs5000 and Rs10000

Interest
8.2% compounded half yearly on 5 year tenure.
8.7% compounded half yearly on 10 year tenure.

Account Holding Type
Individual,joint,minor

Tenure
5 and 10 year

Tax Benefits
Amount Invested for 5 year tenure is eligible for tax deduction and Interest earned are tax free.But if the accrued interest is not taxed every year on an accrual basis then the entire income is taxable on maturity.

How to Join The Scheme/Account/Deposit/Policy?
Certificates can be bought from any post office or general post office.the following procedure:
  • You need to fill the NSC application form available at the post office.
  • Carry original identify proof for verification at the time of buying.
  • You can buy the certificates with cash,cheque or demand draft drawn in favor of the postmaster of the post office from where the NSC is being bought.
  • Choose a nominee and get a witness signature to complete the formalities when buying the certificate.

Objective And Risk
The main objective of investing in the NSC is to avail tax deduction on deposit and guarantee returns on Investment.The five and ten year tenure is used by many to create a regular monthly income stream in retirement.

Tips
Assured Income,Certificate can be bought on every month after 5 years it becomes steady Monthly income stream.

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