Senior Citizens (aged 60 years or more) are offered a higher fixed deposit interest rates by banks as compared to general public. They usually earn 0.25% to 0.75% higher interest compared to regular deposit rates for tenures ranging between 6 months to 10 years. All the resident and NRI senior citizens of 60 years or above are eligible to open Senior Citizen fixed deposit account with the banks. You can easily calculate Senior Citizen FD Interest using FD Interest Rate Calculator.
Senior Citizen Fixed Deposit
Senior citizen FD earns slightly higher returns than interest earned by the general customers. Important features of Senior Citizen Fixed Deposit are as follows:
- The Income Tax Act defines a senior citizen as a resident individual aged 60 years or above during the financial year. Persons who are aged 60 years or more on the date of investment are eligible for senior citizen fixed deposit.
- Senior citizens earn 0.25% to 0.75% higher interest than that of general customers.
- Tenure on senior citizens FD is between 7 days to 10 years in most of the banks.
- Senior citizens with taxable income up to Rs 5 lakh can claim TDS exemption on bank interest by submitting Form 15H to the bank.
- Senior citizens are eligible for deduction u/s 80TTB of the Income Tax Act up to a maximum of Rs. 50,000 on interest from fixed deposits with a bank or a co-operative bank or a post office.
- Senior citizens also can claim exemption of upto Rs 1.5 lakhs per financial year under Section 80C of the Income Tax Act by investing in a tax saver FD but there will be a lock in period of 5 years.
- Loan against senior citizen FD is allowed.
- Premature withdrawal of senior citizen FDs will attract penalties.
To assist you to select the best bank for making FD investment, we are providing following table which shows interest rates offered by different banks to senior citizens for a period of 12 months. You can click on "FD Interest Rates" button against a particular bank FD interest rates of all the tenures offered by that bank.
Senior Citizens FD Interest Rates List Jan 2022
Disclaimer: The FD Interest Rates keep on changing. You are advised to check the interest rates with banks before making your savings. Source: Bank Websites
There are many investment options which are safe and secured like Public Provident Fund (PPF), National Pension Scheme (NPS), EPF, NSC, Bank FD, Bank RD, etc. Bank Fixed Deposit is one of the safe and secured instruments to invest into that offers attractive rate of interest. Easy to open, higher rate of returns, availability of loan and flexibility to withdraw funds when needed are some of the major benefits of Fixed Deposit. Unlike shares, the returns on FD are not related to any market fluctuations hence remain fixed. Banks also offer Recurring Deposit Facility.
Fixed Deposit Account with any bank can be opened easily through a number of channels like Internet (online), Phone Banking or simply by visiting the bank branch.
The interest earned on bank FD can be availed in following 2 ways:
(1) Traditional Plan: Interest is paid on monthly or quarterly basis as required by you.
(2) Reinvestment Plan: Interest is compounded quarterly and reinvested with the principal amount. The interest is paid along with the principal at the time of maturity.
Bank FD is considered to be a beneficial investment option for Senior Citizens due to following reasons:
- Bank FD is low risk option
- It generates a fixed return which is very essential for the financial health of senior citizens
- It is designed to provide financial security to aged people
- It offers better interest rates to senior citizens
- It can also become an additional source of income for retired persons
- There is no upper cap on investment hence senior citizens can invest their life-savings in bank FDs and get safe & fixed returns