5 Reasons why senior citizens should invest in fixed deposits4 min read . Updated: 14 Oct 2019, 12:28 PM IST
Bajaj Finance Fixed Deposit ensures a secure financial future while providing higher interest rates, guaranteed returns and taking care of emergencies.
Since retirement marks the end of your working years, you may no longer have a regular source of income. Thus, planning your finances beforehand is important to maintain your desired standard of living. When investing as a senior citizen, minimising risk and earning guaranteed returns should be your main objective. Only then can you safeguard the wealth that you have accumulated throughout your career. While there are several investment options tailored for senior citizens, a fixed deposit remains a popular choice.
From the safety of investment to guaranteed returns, a fixed deposit is a safe haven for your retirement. This is why most investors approaching retirement or those who are retired invest in this low-risk option to safeguard their wealth. Take a closer look at what makes this instrument ideal for your needs as a senior citizen.
Fixed deposits offer higher interest rates to senior citizens
Typically, issuers of a fixed deposit offer a higher interest rate to senior citizens as compared to regular investors. For instance, Bajaj Finance, one of the reputable NBFCs in India, offers an additional interest of 0.35% on Fixed Deposit for senior citizens, which totals up to 8.70% for selected tenures. To understand how varied tenures will alter your returns, take a look at this calculation.
You can also opt for the auto-renewal facility at the time of applying for an FD. This way, your maturity proceeds will be reinvested. Thanks to this, your returns will multiply. On choosing the auto-renewal facility, Bajaj Finance offers an additional interest rate of 0.10% on the prevailing rates. Assuming that the fixed deposit tenures remain unchanged, here’s how much you can earn on your FDs.
Fixed deposits help in meeting recurring and non-recurring expenses alike
Besides meeting your daily expenses, as a retiree, you may have other non-recurring expenses and goals to achieve. For instance, you may want to gift a property to your children, host a wedding, throw a grand party, make a prepayment of your home loan and so on. To conveniently pay for each need, you can ladder your FDs over varying tenures and align them to different goals. This way you will always have funds at your disposal to tackle your needs on time.
With Bajaj Finance Fixed Deposit for senior citizens, you can choose tenures ranging from 12 to 60 months. Besides, you can also choose from various regular payout options like monthly, quarterly, semi-annually and annually, as per your choice. To meet monthly expenses, you can invest in an FD and choose the monthly payout option, whereas to meet non-recurring expenses, you can invest in an FD payable at maturity.
Fixed deposits can be pledged as collateral to avail a loan in emergencies
Emergencies can show up anytime in your life. As a senior citizen, this may most often take the form of medical treatments. To aid you in such times, Bajaj Finance lets you pledge your FD as collateral and avail a loan against it. You can apply for this loan online and access a sanction of up to Rs.4 lakh almost instantly! This way, you can address your emergency without breaking your investment and keep earning interest on it until maturity.
Fixed deposits are not linked to the market and offer guaranteed returns
Unlike equities and most other investments, fixed deposits are not linked to the market. This means your interest rate will remain unchanged throughout the tenure and so your returns are assured. Besides, you can also determine your returns beforehand using the FD calculator and plan your finances accordingly.
Fixed deposits are easy to invest in and monitor
Unlike other investments, you can invest in a fixed deposit without any hassle. All you have to do is fill in and submit an application form and make the payment. With Bajaj Finance, you can also open an FD online from the comfort of your home. Alternatively, you can visit your nearest branch and invest using your debit card. If you wish to invest in several FDs at once, you can do so by opting for the multi-deposit facility. Here, you can invest in up to 5 FDs using a single cheque and still choose a different amount and tenure for each unique scheme.
Monitoring your FD is also as simple. In fact, as the FD interest remains unchanged throughout the tenure, you don’t really have to monitor the performance but keep an eye on its maturity. Some issuers like Bajaj Finance also offer auto-renewal facility. Thanks to this facility your maturity proceeds are automatically reinvested when the tenure ends. You can also avail doorstep services, or invest online, to ensure a hassle-free investment experience.
So, as a senior citizen you can invest in fixed deposits to safeguard your capital, earn guaranteed returns and keep your worries at bay. With the Bajaj Finance Fixed Deposit, you can rely on the high stability rating of FAAA and MAAA by CRISIL and ICRA, respectively to secure your sunset years by assuming no risk at all.
Disclaimer: This content has been distributed by Bajaj Finserv. No HT Group journalist is involved in the creation of this content.