Senior citizens have always preferred fixed deposits in India over other instruments. This is because it not only provides safety of the invested amount, but they can also generate regular income from it by investing in a non-cumulative FD that offers periodic payouts.

Recurring deposits or RD also offer a high-interest rate and safety of your deposits among fixed-income instruments. However, there is much difference between RD and FD, especially regarding the interest calculation method. FD accrues interest for the lump sum amount for the complete tenor, whereas only the first deposit accrues interest for the entire tenor when you invest in an RD.

Also, some banks and NBFCs provide higher interest rates to senior citizens. You can get these interest rates only if you are above 60 years of age. However, banks have already lowered the interest rates of their fixed deposit plans due to the repo rate cuts done by RBI. Therefore, the interest rates will need to be higher even if you get a different interest rate for being a senior citizen.

To ensure high returns with a senior citizen FD, you can adopt these ways:

Invest in corporate FDs

Repo rate cuts have not affected corporate FD schemes; therefore, you can earn higher interest through one of these schemes. Also, you can expect better returns by depositing your savings for a longer tenor as the draw gets compounded every three months.

You can book a non-cumulative FD with a monthly interest payout option to cover your regular expenses. For example, Bajaj Finance provides an interest rate of up to 7.35% to senior citizens which is 0.25% more than the interest rates offered to regular investors. It also provides the option of monthly, quarterly, bi-annual, and annual interest payouts.

There is no need to visit a branch office or bank to open an FD, as Bajaj Finance has provided its customers with its customers an online account opening facility. Therefore, you just have to visit its official website and fill out an FD online form to book an FD. Moreover, you don’t have to worry about your deposits as these FDs are credited as safe by credit rating organizations like CRISIL and ICRA. Also, the investments can be tracked online with Experia – your online account expert. Also, the assets can be tracked online with Experia – your online account expert.

Use FD as an income source.

Fixed deposits can be used to earn a regular income by investing in non-cumulative FDs that even provide monthly interest payouts. These payouts can easily cover your medical bills and other expenses.

The returns and monthly payouts can be calculated with the help of an FD return calculator, which you can find on the website of your financier.

Deposit in multiple FD accounts

In a financial emergency, you might have to withdraw an FD prematurely. By starting an FD prematurely, you will lose the interest you were supposed to get at maturity. However, you will not have to break the entire deposit amount if you deposit in multiple FD accounts.
  • To get better liquidity options, you can also ladder your deposits by investing in fixed deposit plans of different tenors.
  • Bajaj Finance allows you to choose a flexible tenor for your FD from 12 to 60 months. Also, the option of a multi-deposit facility will enable you to invest in multiple FDs of varying tenors easily.
Senior citizens prefer to invest in a fixed deposit in India as it is safe and ensures high returns. The banks have lowered their fixed deposit interest rates due to the challenging economic situation and repo rate cuts. To continue to earn better returns, you can ladder your deposits. Corporate sterilized You cans like Bajaj Finance FD provide a high-interest rate of up to 7.35% to senior citizens. You can also open and manage your FD account online by investing in these FDs. You can also open and manages to get t, he option can also support one cheque.