Finance

Why You Should Gift Your Dad A Senior Citizen FD?

3:51 AM Rajesh singh 4 Comments


A fixed deposit as we all know provides a safe haven for investments as it offers guaranteed returns. There are many customized FDs available to suit the needs of each individual or investor. From part-time working students to young office goers, doctors, cab drivers, chartered accountants, housewives and even retired individuals like senior citizens can make use of FDs. If you wish to gift your dad or an aged family member, complete independence during their golden years of life, then a senior citizen FD is the best bet.

Current Exemptions and Benefits

Senior citizens receive many benefits when it comes to their finances, like Section 80TTB. As per this clause, deposits up to Rs. 50,000 will be exempted. This is quite an increase from the previous limit of Rs.10,000 and enables the senior citizen population to be free of Section 80TTA.

Filling up and submitting Form 15H can help to avoid TDS on your returns from FD. Also, a fixed deposit doesn’t get affected by market fluctuations. A non-cumulative fixed deposit helps to get regular returns like a monthly term which will help to receive the kind of money that one is used to while working in a job.

A senior citizen who has been there, and seen it all, wishes to spend the rest of his time with dignity and his head held high. An FD does just that and makes sure that your dad could maintain his previous lifestyle and never needs to approach you for his financial needs. Other than banks, NBFCs (Non-banking Financial Companies) such as Bajaj Finance offers 0.35 % higher interest rate to senior citizens than their normal interest rate. Investors can also calculate their returns in advance before investing through FD Calculator. They can even track their FD through the online account provided by banks and financial institutions.

How to Select the right FD?

Doing enough research is also imperative before zeroing in on an FD. For example, there are many financial institutions other than banks, which provide fixed deposits. However, many of those fixed deposits are unsecured loans. The deposited amount is not insured at all. To avoid such investments, check the credit rating of that firm. Rating like AAA is considered a safe and stable form of FDs. Bajaj Finance has CRISIL’s FAAA and ICRA’s MAAA rating when it comes to safety standards.

It also provides the option of flexible tenors for senior citizens FD in the range of 12 to 60 months. Many fixed deposits aimed towards senior citizens are flexible and can accept initial deposits around Rs. 25,000. However, you must make sure to check the safest investment options for senior citizens before investing.

Application Process Tedious!

The application process has also become quite easy through online mediums. The long queues have almost disappeared and the documentation process for FDs have become less tedious with just your photograph and a KYC document required for submission.

Low-Risk Investment

A fixed deposit is generally considered as a low-risk investment. However, one should look at the terms and conditions. Else, one may get average returns on their FD investments. For the convenience of senior citizens, many online apps and websites are trying their best to make their interface user-friendly. Apart from this, firms are making efforts such as Bajaj Finance to guide senior citizens on choosing the best FDs and financial schemes.

Gifting an item to someone on his or her special day is a way to show your appreciation but to give something which appreciates their value is indeed a gift.

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