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Senior Citizen FD Rates

About Senior Citizen FD Rates

Senior citizen Fixed Deposits (FDs) can be explained as term deposit plans that have a special interest rate. The Senior citizen FD rates are offered by the lending banks to individuals over the age of 60 years.

Senior citizen FD accounts offer a large number of benefits to account holders. One of the biggest benefits is that for individuals over the age of 60 years, the special senior citizen FD rates can go up to 0.50% more than the rates for the general public.

Apart from that, the regular interest payout options can allow senior citizens to have a steady and reliable income stream. This can even be a good retirement plan. Senior citizens can also get loans against their FDs if required. Further, senior citizens can also save tax by choosing a five years tax saver fixed deposit.

Benefits of FD for Senior Citizens

We have mentioned a couple of benefits of getting fixed deposits for senior citizens. Let’s delve deeper into what those benefits are.

  • Get more earnings due to higher senior citizen FD rates
  • Create a safe space for your money to grow at a steady pace
  • Get monthly income and more peace in your retirement years
  • More flexibility in terms of tenure, payout options, and amount of FD

 

Senior Citizen FD Rates

Now you know about the benefits of getting an FD as a senior citizen. So, let’s take the next step and become more familiar with the different senior citizen FD rates available in the market. These senior citizen FD rates are mentioned in the table below.

Bank 1 Year to 5 Years Above 5 Years
IDFC First Bank 2.75% to 5.75% 5.75%
Repco Bank 4.25% to 6.25%
Tamilnad Mercantile Bank 3.50% to 5.75% 5.50%
DCB Bank 4.25% to 6.75% 6.75%
Lakshmi Vilas Bank 2.50% to 6.00% 5.50%
Yes Bank 3.50% to 6.75% 6.75%
Deutsche Bank 1.80% to 6.25%
Karur Vysya Bank 3.50% to 5.65% 5.75%
Bandhan Bank 3.00% to 5.75% 5.50%
IDBI 2.90% to 5.10% 4.80% to 5.60%
IndusInd Bank 3.00% to 6.50% 6.25%

The top banks that provide amazing senior citizen FD rates are given below.

Fixed Deposits with Bank Less than 1 Year 1 Year to 5 Years More than 5 Years
SBI 2.90% to 4.90% 4.90% to 5.30% 5.40%
HDFC Bank 3.00% to 4.90% 5.40% to 5.80% 6.25%
Canara Bank 2.95% to 4.95% 5.70% to 6.00% 6.00%
ICICI Bank 3.00% to 4.90% 5.40% to 5.85% 6.30%
HSBC Bank 2.75% to 3.60% 3.60% to 4.50%

Eligibility for Senior Citizen FD

The first thing that one has to note when it comes to eligibility for senior citizen FD is that one must be a resident of India. NRI senior citizens can also open these FDs through NRO or NRE accounts. Beyond that, the individual should also be over the age of 60 years.

There are also some banks that allow individuals over the age of 55 years to open senior citizen FD accounts. Some banks also allow individuals who have opted for early retirement to open senior citizen FD accounts. This is why it is best to directly contact the bank for the eligibility for senior citizen FD.

Features of Senior Citizen Fixed Deposits

The features of senior citizen fixed deposits remain the same as regular term deposits. Some of these features are:

  • The tenure ranges from 7 days to 10 years depending on the bank
  • Nomination facilities for all customers
  • Interest rates for senior citizens are also very competitive
  • The interest rate is earned on a compound and simple interest basis

 

How to Calculate Senior Citizen FD Rates

Calculating the FD interest rates for senior citizens can be a very boring or complicated task. However, this is an important task that will make sure that the senior citizens are able to get the most out of their investment.

A senior citizen fixed deposit can allow an individual to earn through simple or compound interest. On top of this, a fixed deposit is a safe and easy investment that only requires a one-time deposit only. At the end of the FD period, the individual will get the deposit back along with the interest amount.

Factors Affecting Senior Citizen FD Rates

There are many factors that can increase or decrease senior citizen FD rates. Some of these factors are:

  • Rate of inflation that is linked to deposit rates
  • Adequate liquidity in the country will ensure that banks do not have to focus on retail fixed deposits
  • Less demand for credit will mean that banks will decrease fixed deposit rates
  • Interest rates are also cut in anticipation of a lending rate cut
  • Falling call rates signal the amount of liquidity available in the market
  • Plummeting fund costs in the market would result in the banks cutting their interest rates
  • Factors affecting the net interest margin of banks

 

FAQs:

I’m a senior citizen. Do I have to pay TDS for fixed deposits?

Senior citizens only have to pay TDS (Tax Deducted at Source) only when the combined interest for all the fixed deposits that one holds in a specific customer ID with the bank exceeds INR 50,000 in a financial year.

Can a senior citizen open a joint fixed deposit account with someone who is not a senior citizen?

Yes, a senior citizen can open a joint fixed deposit account with someone who is not a senior citizen. However, it should be noted that in these cases the first or the primary account holder should be the senior citizen only.

Is proof of age required for senior citizens when they want to open a second or third fixed deposit account with a bank?

Yes, senior citizens do need to furnish proof of age before opening a fixed deposit account in a bank.

Are additional interest rates available for senior citizens in case of bulk fixed deposits?

The answer to this question will change from one bank to another. However, usually, bulk deposits with a value of over INR 2 crore do not have any preferential or additional rate of interest for senior citizens.

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