Ensuring financial security after retirement is a priority for senior citizens. Many seniors favour Fixed Deposits (FDs) as they are safe and provide assured returns. Tax Saving FDs are particularly popular in this regard since they offer both income and opportunities to save on taxes. To make these plans even better for senior citizens, ICICI Bank provides competitive interest rates. This blog discusses Tax Saving FD schemes, their features, and advantages with competitive interest rates for senior citizens.  

Defining a Tax Saving FD

Investing in Tax Saving FDs can result in tax exemptions of up to Rs. 1.5 Lakh under Section 80C of the Income Tax Act. It’s a popular option for people who want to reduce their taxable income.

These FDs have a 5 year lock-in period, after which you can withdraw the amount. It helps investors allocate the money invested towards long-term savings objectives. Only one-time lump sum investments are accepted into Tax Saving FDs, usually when the FD is opened. It makes long-term financial responsibility planning easier and offers additional tax benefits.

Features of Tax Saving FD

Tax Saving FDs combine secure investment options with tax benefits, making them an ideal choice for long-term financial planning.

• Tax Benefits

Investors use Tax Saving FDs to claim tax exemptions of up to Rs. 1,50,000 under Section 80C and lower their tax burden.   

• Lock-In Period  

The requirement to keep funds locked in for five years encourages a habit of saving without the option for withdrawals or taking loans against the FD during this time frame.   

•  Fixed Returns  

Tax Saving FDs provide assured returns compared to investments tied to the market, making them a reliable choice for investing.   

• Additional Interest for Senior Citizens  

Banks offer an additional interest rate to senior citizens on FD, making these investments more appealing to retirees.   

• Flexible Investment Amount

You can invest a minimum amount as per the bank’s policy, starting from Rs. 10,000, and claim tax benefits for investments up to Rs. 1,50,000 under Section 80C of the Income Tax Act.   

Advantages of Tax Saving FDs

Here are the benefits of Tax Saving FDs:

• Assured Returns  

Tax Saving FDs offer stable and sure returns on your money. It is a great choice for senior citizens seeking low-risk investment opportunities for their secure future after retirement. 

•  Tax Savings  

By putting your money into a Tax Saving FD, you can reduce your taxable income and save a good amount on taxes.   

• Higher Interest for Senior Citizens

Senior citizens can boost their earnings and have a regular income flow with higher interest rates offered to them.   

• Safety and Security  

These FDs are supported by major banks like ICICI Bank, which means there is an assurance for the safety of your investment.   

• Simple and Convenient  

Opening and managing a Tax Saving FD is simple and convenient since you can easily apply digitally using Internet banking or mobile banking apps.   

• Encourages Disciplined Saving  

The lock-in period encourages people to save money. It further helps ensure that the funds saved are reserved for future requirements, especially for senior citizens. 

Best Tax Saving FD With High Interest Rates for Senior Citizens 

A Tax Saving FD, which is favourable for senior citizens, should offer high interest rates to help with long-term savings and an easy application process. Leading banks like ICICI Bank provide a 5-year Tax Saving FD, specially introduced for senior citizens. It offers a unique mix of tax advantages and high FD rates of 7.85%. This FD ensures that senior citizens can earn more than they would with regular FD. 

A key advantage of this Tax Saving FD is that it enables senior citizens to avail of a tax deduction up to Rs. 1.5 Lakh under Section 80C of the Income Tax Act, lowering their taxable income. 

This FD requires a commitment of five years to promote assured savings and secure profits over time for individuals seeking a dependable income source in the future, along with tax advantages. 

You need a minimum investment of Rs. 10,000 to start the FD and enjoy the tax benefits on amounts up to Rs. 1.5 Lakh. ICICI Bank offers a convenient way to start a Tax Saving FD with the flexibility to apply online through Internet banking or the iMobile app. In addition to this convenience, the nomination option provided by the FD acts as an added protection measure. 

Conclusion 

A Tax Saving FD is a great investment option for individuals above the age of 60 years. Here, ICICI Bank’s Tax Saving FD stands out as a smart choice among others. These investment plans offer a way to grow your money and assist in reducing your tax burden. 

With a high interest rate of 7.85% for senior citizens, it is a safe investment choice with an easy application process. ICICI Bank’s Tax Saving FD is designed to meet the needs of retirees, helping you build savings and secure a steady income while minimising taxes. If you are looking to build your savings or secure an income while minimising taxes, Tax Saving FDs can be the right choice for you.