Top Reasons Why Fixed Deposit is Best Option for Senior Citizens

If you are a senior citizen, investing money in financial institutions is a great way to see your savings grow. And choosing the right investment instrument is an important step. Unfortunately, many forms of investments are inclined to market fluctuations. And, as a senior citizen, it is better to choose an investment instrument that offers guaranteed returns and other benefits. Go through this article to know more about an ideal investment tool for senior citizens.

What Is A Fixed Deposit?

Fixed deposit (FD) is an investment tool provided by financial institutions that lock up money for a specified period. It provides a higher rate of interest than a regular savings account. Moreover, if you find a financial institution offering the highest FD rates, your capital grows even faster. Fixed deposits provide many advantages to investors and are risk-free, making them one of India’s most favorable investment choices.

What Makes Investing In Fixed Deposits Beneficial For Senior Citizens?

Investing in a fixed deposit is beneficial to investors of all age groups. However, there are extra benefits for senior citizens.

  • Since retirement marks the end of your working years, you may no longer have a fixed source of earnings. With interest earned from a fixed deposit, you can conveniently fulfill your family responsibilities. Moreover, a fixed deposit is a haven as it assures you guaranteed returns from your investments after retirement with the highest FD rates of interest.
  • As mentioned earlier, it is a safe and secure form of investment with fixed returns and is not market-driven. You will not need to keep up with the market and worry about returns after investing in a Senior Citizen Fixed Deposit because market fluctuations do not affect fixed deposits. In addition, it is a one-time effort.
  • Senior citizens can open a fixed deposit account with an investment amount of INR 10,000. Moreover, there is no upper limit.
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  • You can choose the tenure of your fixed deposit according to your convenience. The tenure can be anywhere between one year to ten years. Each financial institution has its own tenure rules so that you can decide the perfect one for your needs. If you want to get the highest FD rates, consider investing for an extended term, such as ten years.
  • In financial emergencies, you can always break the fixed deposit and withdraw your investment with accrued interest before maturity since it is a liquid option. However, financial institutions generally charge a minor penalty on premature withdrawals. 
  • As discussed previously, the interest rate of a fixed deposit account is higher than regular savings accounts. And, it is even higher than usual for senior citizens in financial institutions such as PNB Housing. The interest rate for senior citizen fixed deposits usually ranges from 0.25%-0.65% above the standard interest rate.
  • A fixed deposit can be used to obtain loans in times of need. However, the interest rate of such loans is usually 2% higher than the highest FD rates.
  • Application for a senior citizen fixed deposit is a simple and easy process. With the online application and management facilities provided by housing finance companies like PNB Housing, fixed deposits do not require senior citizens to visit the institution. Investors can check their returns online from the comfort of their homes.

Conclusion

Planning your finances is necessary to maintain your desired standard of living. While investing in financial institutions as a senior citizen, minimizing risk and earning guaranteed returns should be your foremost intention. Senior citizen fixed deposits from reputed financial institutions like PNB Housing Finance provide the highest FD rates and assured capital growth.

You may be interested in “Availing personal loan from the best banks

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