It is the desire of every individual to look forward retiring to an easier life. If you have just retired or at the edge of the retirement, you would surely look forward to putting your retirement money in a scheme that offers you fixed ROI along with liquidity.

Compared to all other plans, an FD for retired person helps you enjoy the golden period of life. If you are looking at a profitable source of income post retirement, you can rely on a senior citizen fixed deposit scheme.

Why invest in an FD for retired person scheme!

  1. Greater degree of safety

Regulated by Reserve Bank of India (RBI), fixed deposits are always insured up to Rs.1 lakh under the Deposit Insurance and Credit Guarantee Scheme of India. It makes a bank’s FD scheme safer as compared to equities which are influenced by market conditions. Even non-banking finance companies’ (NBFCs) fixed deposit plans carry a higher degree of safety, and carry low risk.

  1. Fixed ROI

Be it an FD for retired person or anyone else; you can expect to gain a sure-shot return on your investment (ROI). You can use an FD calculator to know how much you will be able to gain after entering your investment amount and tenor. Being a senior citizen helps you further to avail a higher interest rate on your FDs. Yes, leading online lenders lets you enjoy up to 8.20%.

  1. Higher interest rates

As discussed earlier, being a senior citizen can help you enjoy a relatively higher rate of interest as compared to standard citizens. An FD for retired person can give you a higher 8.40% interest rate which is 0.35% more than standard investors. You can always utilize a free of cost FD calculator available at a lender’s website to know your total earnings at the end of the tenor.

  1. Enjoy good liquidity

Senior citizens need not ask for money from anyone when they have invested in an FD for retired person. Yes, the greatest benefit of investing in an FD scheme other than pocketing a higher ROI is nothing but enjoying a greater degree of liquidity. Yes, suppose you face a financial crunch, you can simply break your FD prematurely and take out the amount to fund your needs instantly. However, premature withdrawals will have you paying the penalty and you will end up with a lower interest rate which was determined at the time of opening the account.

  1. Tax benefits

Under Section 80C of the Income Tax Act, you are eligible to save up to Rs.3 lakh in tax if your age is above 60. Nevertheless, you will need to declare your interest income at the time of filing your ITR every financial year.

The Bottom Line

Now that you are aware of the benefits that you can enjoy upon opening an FD for senior citizen, you should go ahead and open it online and enjoy stress-free retirement! All the best!

Categories: Finance