A fixed deposit scheme is one of the most trusted investment options for senior citizens in India. With the rising cost factors requiring a high level of expected monthly inflation and tenure, banks and post office offer specific schemes which have designed FD schemes for senior citizens and higher interest rates. It is a healthy and secure option for seniors to receive good returns.
Rates of Interest on a Higher Side for Senior Citizens
One of the biggest advantages of senior citizen FD plans is additional interest over basic deposits. An extra interest of 0.25% to 0.75% is offered by banks, which sums up to a colossal jump in the return of medium- to long-term deposits. This residual interest also becomes a safety net for older people going in for stabilized, low-risk investment options. Going on the present interest rate scale of 7% to 9%, senior citizen FDs assure guaranteed and risk-free growth.
Flexible Tenure and Reliable Payout Options
With senior citizen FD schemes, a high level of time flexibility is guaranteed while authoring a deposit anyone can prefer for a stretch ranging from 7 days to 10 years altogether. With that, investors can calculate the deposit tenure in accordance with their set targets in respect to the criteria one would establish for the receival of a lump sum on maturity or payouts monthly for one’s use. The monthly, quarterly, or yearly payout alternatives provide retirees much ease in meeting house expenditure, making FDs a good source of supplementary income on retirement.
Demonstrable safety serves as one of the key-selling features of senior citizen FD schemes as it gives foreign investors a shelter from market upheavals. The DICGC guarantees a ₹5 lakh protection per depositor. Additionally, income equals to ₹50,000 under Section 80TTB as an additional tax benefit, further reduces the effective tax rate and enhances net yield.
Conclusion
For old people, senior FD schemes are highly sought after and stable ECB (earnings-less expenses). High interest rates, easy periods, fixed income options and tax incentives are the offerings that ensure seniors’ peace of mind in their growing years. Senior citizen FDs demand the status of the very much secure modes of investing for those who want to save their money.