A well-designed financial plan is always a good idea to avoid spending on others or to sacrifice your living standard. However, you must priorities financial planning or types of investment schemes that offer a high return if you are a senior citizen, as you are 60 and above years old, on the verge of retirement, or planning to retire.
Senior citizens should have the primary objective when it comes to choosing best investment plan, such as best fixed deposit scheme for senior citizen from various types of investment to earn guaranteed returns with the least risk. Senior citizens need to do so to protect the wealth they have gained throughout their careers. While several investment options are available to senior citizens, the best fixed deposit scheme for senior citizen remains the most popular.
Understanding Fixed Deposits
A fixed deposit is one of the most popular investment options in India. In the common perception, FDs are often seen interchangeably as investments because they are considered safe, offer fixed returns, and come in various options depending upon the period that suits the investor’s needs.
It doesn’t matter how interest rates fluctuate or GDP performance, fixed deposits offer rock-solid returns. Moreover, the compounding effect of its investments allows its investors to earn interest throughout their subsequent investments.
Several fixed deposit plans are available to customers of banks and non-banking financial institutions. A fixed deposit is an investment that takes place over a certain period at a set interest rate and for a specific amount of money. The interest rate on the best fixed deposit scheme for senior citizen usually differs from one financial institution to another. A broad range of fixed deposit options is available, from very short tenures of 7 to 14 days to quite long tenures of 15 years or more.
Best fixed deposit scheme for senior citizen
The Senior Citizen Fixed Deposit is one of the best fixed deposit scheme for senior citizen, and it is one of the most lucrative ways to invest money for people over 60. Leading banks offer the best fixed deposit scheme for senior citizen with high-interest rates. Fixed Deposits offer many benefits, such as a consistent return, loans, and tax-saving benefits. Spending the post-retirement years stress-free is possible when one invests in a Senior Citizen fixed deposit. There is usually a difference in interest rates between senior citizens’ fixed deposit and regular fixed deposit interest rates, usually between 0.25 percent and 0.65 percent. The savings made through fixed deposits also benefit the senior citizens in terms of tax benefits.
To open a senior citizen fixed deposit account, an individual must be a resident of India. Senior NRIs can also open these fixed deposit accounts with their NRE or NRO accounts. A fixed deposit account must be opened by a depositor who is at least 60 years old. Some banks offer FD plans to early retirement customers over 55. Depending on the specific terms and circumstances of the bank, this regulation may differ from one to another.
Features of Senior Citizen FDs
- You can deposit a minimum amount of Rs 100 in the senior citizen fixed deposit scheme, and there is no limit on the maximum amount.
- Tenure for best fixed deposit scheme for senior citizen ranges between 7 days and ten years.
- Banks and non-banking financial institutions provide various interest payout options for senior citizens based on their individual needs. The options include monthly, half-yearly, quarterly, and annual payouts. The interest can be reinvested in FD until the FD matures if depositors choose the cumulative FD option.
- Senior citizens can also withdraw part or all of their fixed deposit amount from banks and NBFCs. The applicable interest rate is, however, penalized by most banks up to 2%.
- There is also an automatic renewal facility that banks provide to depositors. When the fixed deposit matures, it will automatically be renewed.
- DICGC provides an insurance cover for fixed deposits up to Rs. 5 lakhs in case of any adverse event.
Read More: Key Facts About Marriage Loan Interest Rates