When you are in the golden years of your life, you want to enjoy this time without any financial liabilities and dependencies on children or compromising your lifestyle. That’s why you must invest in good senior citizen savings schemes. While choosing a retirement investment options, you should bear the following parameters in mind:
- Risk Appetite
If you are a conservative investor, you should invest in a safe and fixed income instrument such as Bajaj Finance FD that gives guaranteed returns. You may choose market-linked schemes such as mutual funds, equity shares etc if your risk appetite is higher and you understand the workings of the stock market.
- Future Income
You need to estimate the periodic income you want to receive every month to meet your expenses comfortably and plan the current investment accordingly.
You should always diversify your investment portfolio to protect against risk while earning good returns. So, you should spread your investment to bring stable income and grow your wealth.
Now, let’s take a look at different savings schemes available for senior citizens.
- Senior Citizen Fixed Deposits
Senior citizens get a higher interest rate than the regular rate in FDs. With bank FD interest rates in India going down, it is recommended to invest in corporate FDs which offer better returns. For example, senior citizens can earn up to 7.25% on Bajaj Finance FD. You can also opt for cumulative (compounded interest at the end of tenor) or non-cumulative (monthly, quarterly, half-yearly or yearly payouts) modes in FD. There is also no investment limit. Moreover, FDs are very safe as they are free from market fluctuations. You can also withdraw them prematurely in case of an emergency.
- National Savings Certificate
NSCs are post-office based savings instruments and very secure with adequate returns. There is no upper limit of investment. However, premature withdrawal or periodic income is not permitted in NSCS due to the lock-in period of five years.
- Post Office Monthly Scheme
PO MIS is a safe scheme to earn fixed monthly income, but there is a restriction on the investment limit. You can invest up to Rs4.5 lakhs for single ownership and up to Rs9 lakhs jointly. The interest rate is revised quarterly by the central government.
- Senior Citizen Savings Scheme
You can invest up to Rs15 lakhs in SCSS for five years which can be extended up to three more years. Since it is a government-backed scheme, it is safe and gives reasonable returns. However, you can get only quarterly returns. So, if you are looking for monthly income, SCSS has a limitation.
- Equity-Linked Savings Scheme
ELSS is a good option for senior citizens who are willing to take a market risk or have surplus investment money. It has a lock-in period of three years and can give high returns but only if the market performs well. The returns are available as dividends or on sale of the investment. There are no periodic payouts.
If you compare all these schemes, senior citizen FDs have better advantages over others in terms of high returns, safety, liquidity and periodic income. Bajaj Finance FD interest rates in India are among the best across all senior citizen FD issuers. Bajaj Finance FD is also accredited for high stability by international rating agencies like ICRA and MCRA, making it a secure investment. You can also avail of loan against it to avoid interest loss.
Eventually, whatever scheme you to decide, it should help you build a sizeable nest egg for your old age.