If you want to teach savings to children, deposit ₹500 per month, you will get more than ₹35,000

Usually, to teach savings to children, parents make them put their money in a piggy bank at home. The piggy bank only works for depositing money. It does not give you any extra benefit. But there is a piggy bank in which if you make children put money, they will also get interest on it.

It is said that whatever you teach children from childhood, the same kind of culture develops in them. Along with teaching all manners to your children, financial training should also be given and they should be taught savings from childhood. Usually, to teach savings to children, parents make them put their money in a piggy bank at home. Gullak only works for depositing money. It does not give you any extra benefit.

But there is a Gullak in which if you make children put money, they will also get interest on it. We are talking about Recurring Deposit. RD is also a kind of Gullak. In this, every month you have to deposit a fixed amount and the maturity amount is received along with interest. In such a situation, when children get their deposit amount increased, their happiness will be something else. Know here how 35,000 can be collected by just depositing 500 rupees per month.

Start RD here

Although RD facility is also available in banks and it is of different tenures. But post office RD is for 5 years, but gives good interest. For better savings for your children, start investing in post office RD. The best thing about Post Office RD is that it can be started with just Rs 100 per month. There is no limit on the maximum deposit amount. Currently, 6.7 percent interest is being given on this RD.

In such a situation, if you get children to deposit even Rs 500 every month, then Rs 6,000 will be deposited by them in a year and Rs 30,000 will be deposited in 5 years. At the rate of 6.7 percent, Rs 5,681 will be received as interest on this and Rs 35,681 will be received on maturity. Whereas if the same amount was deposited in a piggy bank, only Rs 30,000 would come out. The benefit of interest would not be available.

Children will also get this benefit of RD

While starting the RD of children, take them along with you. Get the amount deposited by them. This will help children understand how money is invested. It takes some time for a 5-year RD to mature. In such a situation, children will have to be a little patient for that money. This will develop the habit of being patient in them. When they get the money on maturity, explain to them how their money has grown due to the interest on the investment. This will make children understand the importance of investment. In this way, you can easily teach children the lesson of saving and investing at home and give them a better direction to their financial future.

How to open an account for children

An account can be opened in the name of a child by going to any branch of the post office. His mother or father can open an account in the name of a minor. Apart from this, a minor above 10 years of age can open an account in his name. Joint account facility is also available in Post Office RD. Apart from this, RD accounts can be opened in any number.