SBI FD Scheme: Nowadays, everyone considers making safe investments. If you are looking for decent returns alongside safety, a Fixed Deposit (FD) could be the best option for you. SBI, the country’s largest bank, offers excellent FD schemes with varying tenures. You can invest in these schemes for periods ranging from 1 year to 10 years. Under these schemes, SBI offers senior citizens higher interest rates than regular investors.
Interest Rates on SBI FDs
SBI offers a 1-year FD scheme with an interest rate of 6.25% for regular investors and 6.75% for senior citizens. For a 2-year FD, the rates are 6.40% for regular investors and 6.90% for senior citizens. For FDs with tenures between 3 and 4 years, regular investors earn 6.30% interest, while senior citizens receive 6.80%. Finally, for FDs ranging from 5 to 10 years, the interest rate is 6.05% for regular investors and 7.05% for senior citizens.
Returns on a ₹1 Lakh FD
Investing ₹1 lakh in an FD yields substantial returns. With quarterly compounding of interest, a 1-year FD provides a return of ₹106,398 to regular investors, while senior citizens receive ₹106,923. Consequently, extending the investment tenure will also increase the maturity amount. If you invest this amount in a 10-year Fixed Deposit (FD), general investors will receive a return of ₹182,298, while senior citizens will receive ₹201,146 upon maturity.
Keep these points in mind as well.
When opening an FD, it is important to understand the terms regarding interest rates, investment tenure, penalties for premature withdrawal, and tax implications. Additionally, check the compounding frequency and how the auto-renewal facility works upon maturity. If you are investing a substantial sum, it may be prudent to split the amount across FDs with varying tenures.