Updated on: Monday, November 01, 2021, 09:39 PM IST

Top reasons why senior citizens should invest in fixed deposits

Top reasons why senior citizens should invest in fixed deposits |

Top reasons why senior citizens should invest in fixed deposits |


Planning your finances is crucial before your retirement as you would not have a fixed source of monthly income once you retire. The best way to ensure a secured income source is by investing your hard-earned money in trusted sources. Though there are several options to invest in, fixed deposits remain the safest and the best choice for senior citizens.

While on the one hand, you can invest your money in various stocks, these might be subject to fluctuations increasing your risks. Are you sure you can sustain such risks at old age? Since most people cannot undertake and overcome such risks, they invest their money in fixed deposits owing to its security.

Here are some of the most common reasons why investing fixed deposits is best for senior citizens.

Secured investments

Fixed deposits are one of the most secure ways to invest your money. For instance, if you invest your money in a company’s stock and its value falls over time, you are at the risk of losing all your money. However, that is not the case for fixed deposits. Under the fixed deposit scheme, you invest a certain amount of money at a specific interest rate. Thus, irrespective of the market condition and fluctuations, you are bound to receive your expected returns. As a result, the interest rate of fixed deposits is not affected by exogenous factors.

High-interest rates

Fixed deposits typically have higher interest rates for senior citizens. Higher interest rates imply that the senior citizens get a higher return on the money they invest. The interest rates range from 8-8.7%, depending on the tenure of the fixed deposit. Senior citizens should check the interest rates available at different banks and other institutions and compare them. It is always better to choose the schemes with the highest FD rate, even if it may be for a more significant period. Remember, the higher the interest rate, the greater the returns will be.

However, enjoying the highest FD rates might also imply waiting for long periods. Long periods are generally unfavorable for individuals who need an assured source of income regularly. In such cases, senior citizens should choose alternative fixed deposit schemes.

Schemes to meet recurring and non-recurring expenses

Fixed deposits help individuals to meet both recurring and non-recurring expenses. For instance, a retired individual might have both regular costs and non-recurring ones like the marriage of their children and the like. Fixed deposit schemes let individuals choose between various periods and also the payout type. Thus individuals can opt for a monthly, quarterly, or annual payout scheme that suits their requirements.


Fixed deposit schemes are not just a safe mode of investment for senior citizens. Instead, fixed deposits also have various options and schemes that help senior citizens meet multiple kinds of expenditures. Thus, it is always better for senior citizens to invest in fixed deposits than in the market to avoid unnecessary risks and secure a stable post-retirement life.

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Published on: Monday, November 01, 2021, 09:39 PM IST