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Advantages of Senior Citizen Fixed Deposits

Generally when people reach the age of 60 (the age of retirement) in India they look for an investment which does not lead to capital erosion. Senior citizen FD rates provide a worthwhile savings opportunity. Let us checkout the benefits which the senior citizen fixed deposits offer.

Higher Rates of Interest

These fixed deposits yield good amount of profit as the senior citizen fixed deposit interest rates are higher than what is provided to general public; the interest rate on fixed deposits varies between 7.25% and 8.75% for senior citizens. If you are investing more than a crore then the interest rates are even higher.

Flexible Financial Portfolio

Fixed deposits for senior citizens are extremely flexible so that their needs are met. First of all, the fixed deposits for senior citizens can be kept for both short and long time periods. The tenure for fixed deposits range from 91 days to 10 years; there are some FDs which can be kept even for a week. These fixed deposits are also ideal to be used during exigencies as users can take loans and avail overdraft facilities on these FDs. Want a partial or premature withdrawal? That is also available on these specialised senior citizen fixed deposits. Last but not the least; the fixed deposit can be easily liquidated by sweep in facility. 

Make Small Investments

Do not want to put all your money as fixed deposits? These senior citizen fixed deposits start as low as Rs5000 and can run even above 1 crore. So now you choose how much you want to invest in a fixed deposit. FD interest rates for senior citizens will differ as per the lock in period and amount invested. 

Get Regular Income

Tensed that the regular flow of income will be stopped when you retire at the age of 60? No. You need not wait till maturity of the FD to get the interest. The FD interest rates for senior citizens can be made on monthly, quarterly or yearly basis as per the need of the customer. If the fixed deposit tenure is less than 181 days only then the interest will be paid at the time of maturity.

Easy and Super Fast Investment

It is easy to invest in FDs. Senior citizens need not even visit bank branch to make the investment. The deposit can be made through net banking.

Safe Investment

Senior citizen fixed deposits are a must for a secure future. Besides paying a higher rate of interest, these FDs ensure a fixed income. These are not dependent on market fluctuations and the interest rate is steady throughout the tenure of the FD. Moreover, there is nomination facility available and thus the FD gets transferred to the nominee of the deceased. 


As a general policy, TDS is deducted from the bank account of an individual if the interest earned is more than Rs10,000. For senior citizens, the amount is Rs50,000. Previously only on bank saving account the senior citizens got this exemption but now this tax exemption is available on all types of bank deposits.

So, fixed deposits are the most trusted investment schemes for the senior citizens. Invest today to ensure a steady income growth year after year.

Vikas Agarwal
the authorVikas Agarwal
Vikas Agarwal is an IIT-Varanasi graduate in Chemical Engineering. He is the Founder and CEO of - an investment advisory website. He is a Business Development Professional but a Value Investor at heart. He writes articles on Finaacle, which focus on simplifying the art of investing and the causes of human misjudgment when it comes to investing. He also shares his experiences as an investor and lessons from some of the greatest investors of all time.

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