Fixed Deposit (FD) scheme of State Bank of India (SBI) is a safe and risk-free option for investors. Quarterly compounding and fixed interest rates provide better returns in the long run. Special benefits are also available for senior citizens.

Business News: If you want safe returns by staying away from market fluctuations and risks, then the Fixed Deposit (FD) scheme of State Bank of India (SBI) can prove to be a better option for you. This method of investment is absolutely risk free and the safety of your money is completely assured.

SBI offers the facility to invest in FD schemes for multiple tenures. Investors can select the tenure and interest rate as per their need and time. You can opt for FD up to 10 years. After investing in fixed deposit, your money has no connection with the market, hence it is considered the most reliable medium of safe investment.

What is FD and how does it work?

Fixed Deposit or FD is an investment instrument in which you deposit a lump sum amount in the bank. The bank gives pre-determined interest on that amount. After deciding the interest rate and investment period, you get a fixed return on maturity.

This investment option is special for those who do not want to take risk. Despite market uncertainties, you get fixed returns on FD. This facility is especially beneficial for senior citizens and long-term investors.

How much will you get on maturity of ₹5,00,000?

At present, SBI is giving 6.30 percent interest rate to general customers for tenure more than 3 years but less than 5 years. Senior citizens get a rate of 6.80 percent.

If a senior citizen makes an FD of ₹ 5,00,000 for 4 years, then the return on maturity based on quarterly compounding will be ₹ 1,54,795. This means that after 4 years you will have a total of Rs 6,54,795.

For a normal customer, the return after 4 years with quarterly compounding based on 6.30 per cent interest rate on the same amount would be ₹1,42,036. That means the total deposited amount will be ₹ 6,42,036.

Quarterly compounding increases returns Is

Interest in SBI FD is compounded on quarterly basis. This means that every quarter new interest is added to your interest. This is why you get more benefits from long term FD.

If you wish, interest can be paid on monthly, half yearly or even yearly basis. This facility is beneficial to get regular income as per the need of the investor.

Special benefits for senior citizens

There is a slight increase in the interest rate for senior citizens. This improves their investment income. Also, their total returns increase further through quarterly compounding.

For example, on an FD of ₹5,00,000 for 4 years, a senior citizen will get an additional return of ₹1,54,795, while a normal customer will get ₹1,42,036. This difference is important for investors in the long run.

Know these things before getting FD

Before making an FD, it is important to understand how the interest will be paid. The bank usually adds interest on a quarterly basis from the date of initiation of the deposit or pays a lump sum on maturity.

If you are investing for a period of 12 months or more, interest can be charged at monthly, half-yearly or even annual intervals. This gives investors the option of regular income as per their need.

The amount deposited in FD remains safe and is not affected by market fluctuations. This is why it is considered the most reliable option for investors.

Why SBI FD is a better option

SBI is the largest bank in the country and its FD scheme is considered trustworthy among investors. The security of your money along with fixed returns makes it more attractive.

Investors or senior citizens who want to avoid taking risks in the market can get stress-free returns through this. Besides, it also gives good benefits in the long run.

how to invest

You can invest FD online or by visiting the bank branch. You can easily set up your FD by choosing the investment tenure, interest rate and payment frequency.

With the help of SBI FD calculator, you can calculate the possible returns as per your amount and tenure. This makes it easier for you to plan your investments.

beneficial in the long run

FD gives better returns to investors for long term. Quarterly compounding allows interest to increase over time. If you invest for 4 years or more, the total returns are quite attractive.

The investor should decide the tenure of FD considering his need, time and financial goal. With this, they will get good returns on maturity and will also get the benefit of safe investment.