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Bank Fixed Deposits (FDs) are the safest forms of investment. They are not only risk-free but also flexible as banks allow you to withdraw the amount prematurely when in need. There are different types of FDs in the banks such as the short-term deposits and long-term deposits. The short-term deposits are usually for periods less than six months where the banks give you simple interest on the principal investments. The long-term deposits are re-investment kind of deposits where the bank pays you interest on compound basis.

SBI Fixed Deposit Interest Rates. Account Details APY Updated; SBI 5 Year Fixed Deposit: 6.85%. SBI 10 Year Fixed Deposit: 6.85%.

Visit /fixed-deposit/sbi-fd-calculator.html. Enter the deposit amount, tenure, interest rate, and the type of fixed deposit. Click on ‘Calculate’. The maturity amount and the total interest that is earned will be. State Bank of India (SBI) Fixed Deposit Interest Rates are between 2.90% and 5.40%. For senior citizens the FD rates are between 3.40% and 5.40%. The FD interest rate for other customers is between 2.90% and 4.90%. The interest rate offered depends on the deposit amount and tenure of the fixed deposit. SBI FD rates refer to the rates at which interest is paid on a fixed deposit account for a tenure ranging between 7 days to 10 years. There is a competitive and higher interest rate on FD in SBI ranging from. A couple of days back, SBI has launched a new fixed deposit scheme with the name “SBI Wecare Fixed Deposit” for senior citizens. SBI indicated that they have launched this new FD scheme to safeguard falling interest rates for Sr. While there are several other saving schemes for Senior Citizens, they all have few limitations.

Calculating the compound interest is a complex mathematical operation. The process is extremely difficult and time-consuming. Plus, the results so derived are prone to human calculation errors. Thus, you can use an FD Calculator to determine the interest you receive on maturity of such deposits. One such user-friendly calculator is the SBI fixed deposit calculator. SBI FD Calculator allows you to calculate the total interest you’ll receive upon maturity of your deposit and plan your investment accordingly.

Features and Benefits of SBI FD Calculator

State Bank of India (SBI) offers two kinds of fixed deposits: non-cumulative FD and cumulative FD. The periodic interest payment option is the first one whereas the second category is the reinvestment option. Calculating the interest payment in the periodical option category is easy because SBI uses the simple interest calculation formula. However, you will need the help of the SBI FD calculator to arrive at the maturity amount in the reinvestment category. Let us now look at the features and benefits of the SBI fixed deposit calculator.

The formula for calculating the maturity amount with compound interest is a challenging one to understand and determine. The SBI FD calculator makes your job easy.

SBI Fixed Deposits Interest Rates

State Bank of India is the largest public sector bank in India. It offers various fixed deposit products to its customers at attractive rates of interest. The SBI interest rates change at frequent intervals. Similarly, they have different rates of interest depending on the principal deposit amount. This interest rate table will make things clear.

Below ₹ 1 Crore w.e.f. 28.11.2018

Bulk Term Deposits between ₹ 1 Crore and ₹ 10 Crores w.e.f. 30.07.2018

Bulk Term Deposits above ₹ 10 Crores w.e.f. 30.07.2018

Important points to note

• NRO and NRE deposits have a different rate structure.
• There is a premature withdrawal penalty of 1% for the bulk term deposits.
• Staff members and ex-staff of State Bank of India get an additional interest of 1% on all fixed deposits.

How to calculate the interest with Online SBI FD Calculator

Calculating the applicable interest is a complicated process. It is best to use the SBI Fixed Deposit Calculator to determine the maturity amount and the interest you earn from the deposit. Here is the process explained in a few steps.

• Enter the principal amount, the rate of interest, and the deposit tenure.
• The next step is to choose the interest frequency options. The available options are simple, monthly, quarterly, half-yearly, and annually.
• On clicking the ‘Calculate’ button, you get the maturity amount and the amount of interest.

Tax on SBI Fixed Deposit

The interest received on bank FDs is taxable. You have to include the interest as a part of your income while preparing your Income Tax returns. The income tax rate depends on the slab you fit into while computing your taxable income.

The Income Tax Act 1961 stipulates that banks and other financial institutions should deduct tax at source while paying interest on fixed deposits placed with them if the amount of interest paid to the individual depositor is more than ₹ 10,000 in a financial year. All branches of a bank constitute a single identity. The TDS rate is as follows.

• 10% if you update the PAN details in your account
• Otherwise, the rate is 20%

The banks are under an obligation to deposit the TDS amount to the Income Tax department at fixed intervals. Consequently, the banks furnish the details of the TDS deposited with the IT Department to the depositor vide Form 15G and 15H. You can use these details while preparing your IT returns and claim refunds if applicable.

If your annual income does not come in the tax bracket, you can submit Form 15G (General Public) or 15H (Senior Citizen) along with your PAN details to the banks. The banks do not deduct TDS under such circumstances.

Eligibility Criteria for SBI Fixed Deposits

State bank of India has the most extensive network of branches in India. You are never far away from a State Bank of India branch wherever you are in India. Hence, a significant proportion of the Indian population prefers to open fixed deposit accounts with the SBI. The following categories of entities can open fixed deposits with SBI.

• Individuals – Resident as well as Non-Resident Indians can open FDs in SBI in single or joint names.
• Non-individuals like sole proprietorship, partnership firms, companies, Government departments, clubs, societies, trusts, and associations

One should compulsorily satisfy KYC norms while opening FD in SBI. It is also advisable to avail the nomination facility for your convenience. Ensure to update your PAN details and submit the necessary 15G/H forms if you do not come in the tax bracket.

Use the SBI FD calculator to determine the maturity amount and the interest you earn on your deposit.

SBI, the country’s largest bank has come to the rescue of senior citizens. It has launched a special FD scheme for senior citizens called the SBI ‘WECARE’ Senior Citizens’ Term Deposit scheme(2020).

And what is interesting about this scheme?

The current falling rates scenario is painful for those who depend on interest income. Primarily senior citizens. So this SBI ‘WECARE’ Senior Citizens’ Term Deposit scheme provides a higher interest rate to senior citizens.

Sbi Term Deposit Interest Rate

Here are a few important points about the scheme:

• Only senior citizens, i.e. aged 60 years and above can invest SBI WECARE Deposit. Also, this is available only for resident Indians and hence, NRI senior citizens are not eligible to invest in the scheme.
• What is the interest rate of SBI ‘WECARE’ Senior Citizens’ Term Deposit 2020 scheme? Of course, that is the key question. As per details on the SBI website, the scheme pays additional 0.80% above the rates applicable to the general public. Since the senior citizens were already getting about 0.50% extra over and above the general public FD rates, this SBI WeCare Senior Citizen Deposit offers an additional premium of 0.30% (over and above existing premium of 0.50%) to senior citizen depositors. But this additional 0.30% premium is payable only for term deposits with tenor of 5 Years and above. As of now, the SBI ‘WECARE’ Senior Citizens’ Term Deposit scheme is giving 6.5% interest. You can check the latest SBI Deposit rates.
• The ‘WECARE’ Senior Citizens’ Term Deposit can only be opened for tenor ranging from a minimum of 5 years to a maximum of 10 years.
• And how will the interest* be paid in this scheme? As per details on the site, the interest earned from SBI We Care Deposits is to be paid at monthly or quarterly intervals. At the time of writing this post and based on the data available, I am not too sure if interest payment is available at half-yearly or yearly intervals. Or for that matter if the cumulative option (interest paid at the time of maturity) is available or not. *(For senior citizens, TDS will be deducted on the interest payment if the total interest (from all FDs, RD, etc. but not savings account) paid in a financial year exceeds Rs 50,000. Read more about taxation of fixed deposit interest)
• Is this a permanent scheme? No. It’s a special scheme launched to help seniors during the COVID-triggered interest rate reduction. This is a limited period scheme. And the scheme is open between May 12, 2020, and September 30, 2020.
• Is Premature withdrawal of WeCare Deposit allowed? Yes. But the additional interest of 0.30% under this special scheme will not be payable in case of premature withdrawal

Here is the link to WeCare Deposit announcement on SBI’s website.

How much monthly interest can you get from your FDs? Depends on the interest rate applicable. A few years back I wrote about this. You can read it at i) Monthly interest on Rs 1 Crore fixed deposit, and ii) Monthly interest on Rs 2 Crore fixed deposit.

Now comes the key question.

Should you invest SBI WECARE Deposit 2020 for Senior Citizens?

Sbi Fixed Deposit Interest Rates 2019

Like all questions in personal finance, there is no one right answer here.

For some senior citizens, this may be good. For others, not so.

But still, here are few points to ponder over:

• No doubt if you compare these special rates (+0.80% above general public and +0.30% above regular senior citizen rates) with regular rates, these do seem attractive. But there are some other options as well that are offer comparatively better returns.
• One example is the Senior Citizens Savings Scheme (SCSS) which too has a lock-in of 5 years but currently offers 7.4% per annum. Premature withdrawal from SCSS is allowed with a heavy penalty. But assuming you wouldn’t withdraw prematurely, it does offer 0.90% more than SBI’s WECare Deposit.
• Another alternative is GOI Taxable Bonds offering 7.75% per year. But they do come with a 7 year maturity period. Liquidity is an issue in this no doubt but these are near zero-risk, government-backed safe instruments. And I have long maintained that safety first when it investing in debt.
• Even some NBFCs may be offering higher rates. But for senior citizens, these are best avoided. No point being greedy about a 1-2% more and investing in high-rate-poor-quality debt instruments and take default risk. Some exposure is fine but give more importance to the safety of capital.
• All said, this scheme does score on the safety parameter as its offered by the largest public sector bank, SBI – which is a systematically important and too-big-to-fail and too-important-to-be-allowed-to-fail bank. And fixed deposits good for short term for conservative savers.
• As a senior citizen, you have limited savings and limited scope to generate additional income. So always try to evaluate all the factors of any scheme you plan to invest in, and don’t just be blinded by the interest rates being offered.
• Another factor which I feel many seniors may miss realizing during the current low-interest scenario is that interest rates will eventually revert to their means. Current rates are very low and due to COVID-triggered unprecedented events. It’s possible that rates might improve in the near future. Maybe in a few months or a year or two. So if you lock-in your money at current rates for 5 years, you will miss out on the opportunity to switch to better rates once the interest rate situation improves. So maybe, waiting this few tough months might be better (and accept lower rates temporarily for few months to a year) and then switch to better rate FDs in the near future. To each his own but this is something not to ignore.
• Debt funds can potentially give better returns. But senior citizens need to be very careful if their savings corpus is limited. Read this to know how to pick debt funds correctly.

So that is all about SBI Special WECARE Fixed Deposit (2020) for Senior Citizens. And how to consider various factors when deciding whether you should invest in SBI WeCare deposit in 2020.