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How Does Fixed Deposit For Women Work?

    Women are the backbone of their families and communities. Financial goals and freedom are required by women of all ages and from all walks of life. Innumerable investment options are available today – some are more market linked than others, which can be risky. However, in the area of risk-free and guaranteed returns, Fixed Deposits(FDs) remain the easiest and safest investment option.

     

    Goals and Investments

    Women investors should keep their future goals in mind and invest with a long-term perspective. Fixed Deposit is a fixed income instrument with guaranteed returns. It is a low risk and safe saving option, which yields a steady and assured return. They are offered by Banks and other Non-banking Financial Companies (NBFC). Moreover, Fixed Deposits with a maturity date of over 5 years qualify for a tax exemption under Section 80C of the Income Tax Act,1961. The interest earned on the deposit remains taxable. If you earn less than Rs 5 lakhs, you can easily claim Tax Deducted at Source (TDS) on interest earned by filling out Form 15G/H.

     

    Types of Fixed Deposits for Women

    1. Bank FD –

      The broad types of bank Fixed Deposits are:

      Regular/Standard FD:

      Deposits can be made for a tenure ranging from 7 days to 10 years. Interest is higher than savings bank interest.

      5-Year Tax-saving FD:

      The deposit is locked in for a 5-year period. The principal amount in the FD, with an upper limit of Rs 1.5 lakhs, is exempt from tax
    2. Company or NBFC FD –

      Higher interest or return on investment (ROI) is offered on these Fixed Deposits. Always check the credit rating of these companies before investing.

     

    Female Senior Citizen Age for Banks

    There is no difference in the senior citizen age for females as far as banks are concerned. It remains at 60 for women and men. Higher interest rate and income tax benefits on the interest will be available to senior citizen women only at the age of 60 and above.

     

    Why Should Women Choose Fixed Deposits?

     

    Safety:

    FD offers women safety and assured returns. They are the safest investment option. There is even a safety valve in place as per the Reserve Bank of India guidelines. In case of a default on your bank FD, you can claim compensation of Rs 1,00,000 under DGIC.

     

     

    High FD Interest Rate for women:

    The rate of interest on FD is higher than savings bank interest. Women senior citizen interest rates can go up to 9% also.

     

     

    Minimum Amount Investment Possible:

    A sum as low as Rs 500 is the minimum requirement for an FD. This minimum amount varies from bank to bank. This makes it very easy for women to take the first tentative step into saving and investment and then watch their corpus grow.

     

     

    Flexible Tenure:

    FD tenure ranges from 7 days to 10 years. Women will have the flexibility to opt for smaller tenures to suit financial needs.

     

     

    Loan Availability against FD:

    Women can apply for a loan against their Fixed Deposit. 90% of your deposit amount can be availed as a loan provider you have other documents to prove your income and financial credibility. This facility prevents premature withdrawal of FD in case of emergencies and safeguards the interest that has accrued on the deposit.

     

    Women are becoming increasingly independent. Regardless of whether they are a homemaker or a working professional, they are asserting themselves. Needless to say, Fixed Deposits are a secure and safe choice for women to venture into savings and investment, which has, hitherto, remained a male domain.

    With increasing online banking facilities, it has become very convenient for women to convert savings into Fixed deposits and reap the rewards of assured interest income. Availing compound interest on FD will ensure the growth of corpus and women can enjoy greater benefits.

     

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