SBI Senior Citizen Saving Scheme Offers Tax Benefit With Safe Deposit, Check Scheme

When you think about saving, the conventional investing choice comes first in minds such as a bank or post office fixed deposit, or a term deposit. Although, both post office and banks FDs are a good investment. Banks like SBI is one of the biggest depositor and lender in the country offering diverse and easy-to-access investment cum saving instruments. They also offers a steady income.

SBI Deposit

With SBI FD you can deposit a large sum into an FD and get a fixed rate of interest on your principal amount. You can also get a tax deduction if you have a 5-year FD. SBI pays 5.50 percent yearly interest to regular customers and 6.30 percent to elderly citizens on its 5-year fixed deposit.

According to the Fixed Deposit calculator, if you are a senior person, you will receive Rs 13,66,900 on a Rs 10 lakh FD when it matures. There would be an interest income of Rs 3,66,900 in this.

SBI Wecare Deposit for Senior Citizen

With the aim of protecting senior citizens' income, SBI is introduced a senior citizen-centric "SBI Wecare Scheme". It is a Senior Citizen Retail Term Deposit / Fixed Deposit that allows investors (senior citizens) to preserve and protect their assets. All senior citizens having FDs with a term of 5 years or more are eligible for an additional 0.30 percent in addition to 0.50 percent i.e. 0.80 percent, interest under this plan. This scheme has been extended by the bank till September 30, 2022. Investors can opt for this scheme and save tax and earn good returns till this scheme is open for subscription.

Features and benefits of the SBI WECARE Scheme:

• Get additional interest of 0.80% on term deposits
• Monthly or quarterly interest payments are available on term deposits.
• The scheme can be accessed via net banking, the YONO app, or a branch.
• Subscriber can avail loan facility on the scheme

Benefits of Fixed Deposits

Fixed deposits and term deposits whether with Banks or the Post Office, both are considered safe investments with guaranteed returns. For risk-averse investors, this is a solid alternative. Section 80C of the Income Tax Act, 1961 allows for a tax exemption on 5-year tax-saving FDs. However, the interest earned on the principal amount in FD is taxed.