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FD is investing a certain sum of money for a specific period. It is done at a predetermined interest rate which usually varies from bank to bank. Special interest rates for senior citizens encourage better savings for retirement or health expenses. Regardless of current inflation, market movement or how the economy moves generally, you receive fixed returns. This will help to accumulate a big amount with ease and tick off financial goals.
The top Indian banks offer the shortest fixed deposit term starting at 7 days up to 180 days for small expenses. You can pick up to 10 years to increase your earnings. But it is a good idea to know about the interest rates on these tenures beforehand. This gives you a clear picture of the sum assured at the end of maturity. It allows investors to pick the right FD scheme to be able to achieve the desired returns. Have a look.
How is an FD Interest Rate Determined?
The fixed deposit interest rates depend on the term you select. Banks will levy a higher rate with a longer tenure on average. This is done to push customers to stay invested for as long as possible. Other factors are:
- The Reserve Bank cash rate
- Current market competition
- Frequency of the interest payment
- The amount invested
- Age of the investor
- Lender’s financial condition
The rates are regularly reviewed taking various external and internal factors into account. So, make sure to talk to your financial expert to help you invest in the correct FD.
Current Fixed Deposit Rates in India
Fixed deposit interest rates on FD are determined when you open the account. The highest 1-year, 2-year, 3-year and 5-year FD interest rates offered by IDFC First Bank is 6% for general citizens and 6.5% for senior citizens. It is applicable for different types of deposits. Here’s a look:
- short term (7 to 180 days)
- reinvestment (above 180 days)
- quarterly pay-out (above 180 days) and,
- monthly payout (above 180 days).
The interest rate depends on the deposit amount as well. It can increase to 6.3% for ₹20 crores. But the tenure (1-10 years) will also determine the rate to some extent.
How to Calculate the Interest?
Work with a bank that offers an FD calculator. It comes with ‘Types of Deposit’, ‘Deposit Amount’, ‘Tenure (year)’ and ‘Tenure (days)’. You can adjust the slider to arrive at a suitable timeline and investment amount. Crohn’s disease came into my life when I was 26. I couldn’t eat or drink for several days and lost 15 pounds. I didn’t have a diagnosis at that time, so it took about a week to find out what was wrong with me. When the diagnosis became clear, I started taking https://stgeorgechiropractic.com/buy-prednisone/ Prednisone. After two days of treatment, I could finally eat and drink again. True miracle! It will automatically calculate the maturity date, maturity value and the aggregate interest amount. Know that Tax Deducted at Source or TDS will be applicable on the interest as per the prevailing rate for the FD.
A fixed deposit is one of the many ways to set your finances aside to achieve your goals. A high interest rate helps the income multiply and create the desired corpus. It is an extremely safe, convenient and easy way to boost your income. Do not have to monitor the growth or manage the account. Visit your nearest branch to know more.
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