How to Plan your Retirement with Fixed Deposit Schemes

Retirement Plan with Fixed Deposit Schemes

It’s a common misconception that a FD is an instrument of saving that is meant solely for youngsters. On the contrary, if you’re a retiree or a senior citizen, you can still invest in Fixed Deposits. There are various schemes offered by banks and NBFCs that cater specifically to the needs of senior citizens. These schemes can be used to park excess money, while gaining interest. These deposits in India can be opened by anyone who’s an Indian citizen or an NRI.

Fixed Deposit for Senior Citizen

However, using an Fixed Deposit interest rate calculator will give you a heads up on how the tenure and interest levied can affect you.

Usually, a senior citizen’s FD scheme comes with many features. A few of them are:

  • Same as a regular FD, these schemes too have deposit periods ranging from 7 days to 10 years
  • There are nomination facilities available, under which the depositor can declare a nominee
  • Senior citizen’s FD can be closed anytime, even prematurely
  • The deposit period decides the interest rates offered under these schemes
  • The interest rates on the FD are calculated on a quarterly basis. They can be added to the maturity value of the fixed deposit, or can be credited to your bank account
  • The maximum amount of money that can be deposited under FD can be anywhere from Rs.1 crore upward. It’s up to the bank or NBFC to decide what the maximum limit will be
  • A few of the FDs which have a lock-in period of 5 years, can prove to be tax-saving option for senior citizens, and can provide special interest rates to them


Interest Rates under FDs for Senior Citizens

Several Banks and NBFCs provide senior citizens special interest rates on their FD. That being said, you should remember that some lenders might have certain terms and conditions applied on these interest rates. These terms and condition may vary as per the bank or NBFC, but the general principle doesn’t change.

To avail these special interest rates you should ensure that the duration of your FD is more than 1 year. Short term deposits aren’t eligible for senior citizen interest rates. Also, instances where the account is opened as a joint Fixed Deposit, and the second account holder happens to be a senior citizen, these special interest rates will not be applicable.


A Few Benefits of Senior Sitizens FD Schemes

Benefit of fixed deposit scheme

There are a plethora of benefits offered to retirees and senior citizens under Fixed Deposit schemes, some of them are:

  • It allows your money to accumulate and grow steadily
  • Many Banks and NBFCs provide higher interest rates, therefore resulting in better returns
  • One of the salient features of these FD schemes is that the interest rate earned on them can be turned into monthly incomes, which is ideal for anyone who has retired
  • The FDs meant for senior citizens can also turn out to be tax savers. The tax deductions can be claimed under Section 80C of The IT Act

There are many saving schemes meant for retired employees and senior citizens. But, finding the best Fixed Deposit scheme can be tedious if you don’t know what to look for. So, do your research and compare all the schemes you find, before signing on the dotted line.

If you had to choose between the Fixed Deposit and Saving Account, then it is certain that Fixed Deposits are better for generating higher income and savings accounts are ideal for financial liquidity. However, a combination of both of these investment vehicles make the most financial sense. So, do your calculations and arrive at what best suits your needs and gives you the maximum returns.

Similar Articles

A man looking a credit card and putting the details into a laptop.

It’s no secret that in the years since its introduction, mobile banking has grown exponentially in popularity. In fact, 4 in 10 people in the UK use their mobile banking apps regularly with 71% of the adult population (around 38 million people) accessed their banks via browser or mobile banking app in 2017.


If at any point in your life you have applied for a credit card, started a phone contract, took out a loan, financed a car, leased a flat or bought a house—chances are, someone checked your credit rating. But, what is a credit rating – and why is it so important?

Guaranteed Loans For Unemployed In Nix Contemplation

If anyone says that a circle of hitch has already planned by destiny for you. Maybe they are not exactly wrong but some financial situation happens so unwontedly that we have never imagined in our dreams to pick up your leg out from the mud. For that, you can go for loans.

Organising Your Finances in Retirement

Many of us work our entire lives with the hope of enjoying a good few years of retirement after finishing up full-time work. The road to retirement requires a great degree of financial planning and a keen eye for detail.

5 Essential Accounting Tips for Freelancers

When it comes to freelancing, you have a lot of things to keep on top; your finances are one of the most important ones. When you’re working freelance, whether that’s for a range of companies or yourself as your own business, you are responsible for everything financial – from everyday banking right up to taxes.

Tech Tips: Digital Trends in Crypto Apps

As cryptocurrencies continue to influence the world of financial transactions, it has been only natural to see an upsurge in the number of cryptocurrency apps that are available to enthusiasts.  But with the sheer number of offerings, it can seem overwhelming to sift through all of the products that are available and determine which apps might actually be necessary to install on your devices.


A home is the biggest asset that we all have, but to make sure that it stays the biggest asset, one needs to give regular attention to it. During summer, where we use the maximum numbers of appliance, it is important to take all measures to make our home as energy efficient as possible.

Guide to Buying Your First Car

Buying your first car is an exciting time and a significant life event, but there a lot of factors that you need to consider. Car ownership comes with a large number of ongoing expenses that you’ll need to be able to pay for.  With some careful money management, you can run a car without breaking the bank.


For many, debt isn’t an easy thing to talk about, but the first step towards getting yourself out of the red is to get your head out of the sand and acknowledge the situation.