This aspect of term deposits also need to be considered

People are ecstatic about the rate hike in the fixed deposits, most of the things are in favor of this scheme which has contributed to its success, yet there are a few drawbacks which are associated with this scheme through none of them should be a cause of major concern for the investors but still it is important for a person to be aware about every aspect of this facility.

A term deposits scheme requires the investor to be patient as the more the tenure of the deposit the more investor would earn, also there are various other facilities like stocks, mutual funds that can yield comparatively higher returns in a very short period of time.

The safety feature of this scheme is what keeps the investors in high spirits which is lacking in all the other investment options. The other drawback with this scheme is tax deductions. The interest that the investor earns comes under taxable category and TDS is deducted from the total interest earned by the investor.

Deposit accounts at Post Offices

The fixed deposits facility is not only offered by the banks but the reliable Post Offices also offers this facility known as Post Office Time Deposit. An investor has a choice to choose from a maturity periods of 1, 2 ,3 and 5 years.

The maximum deposit rate offered is 7.50% across the maturity period of 5 years. This facility can be availed at a minimum deposit of Rs. 200 and if a person has a savings account with the same post office then the interest earned and the maturity amount can be transferred directly to the savings account.

Like the bank fixed deposits a person can go for premature withdrawal of the deposited amount but under these circumstances penalty of 2% will be levied on the customer and also the account cannot be closed within 6 months of opening it.

In case the person has not withdrawn the amount even after the completion of the maturity period then after the completion of the maturity period the amount in the fixed deposit account will continue earning interest rate applicable on the savings bank account up to a duration of another 2 years, apart from this nomination facility is also available with this account.

As the Indian Post has an extensive network even in the rural parts of the country, the people in the remote areas can be benefitted with this service.

Consider every aspect while investing under fixed deposits

Banks are offering high interest rates on the fixed deposit schemes and people are happily investing their savings under this scheme, which is rather very good because they now have the chance to expect maximum returns on the invested amount but make the most of the situation it is important that a person decides the maturity period very carefully.

As there is a lot of competition among the banks and to lure the customers they are introducing various attractive deposit schemes and as due to this reason people started to make premature withdrawals and started to invest the money with the bank offering higher interest rate.

To cope up the situation, most of the banks have started to levy penalty on premature withdrawals which has shackled an investor and so people has to stay content with what they have opted, despite the fact that there are far better schemes available for them.

To avoid such situation, it is important that a person takes a decision only after he has made sure that this tae best what he can avail at a certain point of time, apart from that while deciding the tenure of investment a person must evaluate his needs and if he does not require money for some time then only he must opt for longer tenure.

What the deposit schemes have for senior citizens?

Fixed deposit schemes have become the preferred mode of investment for the common people, what has become the attractive feature of depose schemes is the surge in the deposit rates which promises considerably higher returns on the money invested.

Not only for the general citizens but the lenders are also concerned about the senior citizens, banks offer special deposit rates to senior citizens so that they can get maximum returns. They offer higher depose rates because the banks believe that the financial requirements are different for the people of different age groups and considering the age the senior citizens require a bit more financial attention.

So, the banks have developed special schemes for senior citizens that can prove useful to them and can serve the purpose and hence more and more senior citizens are availing this facility.

Hike in the deposit rates of Dhanlaxmi Bank

Most of the leading banks have increased their lending as well as deposit rates after the hike of 50 basis points in the policy rates of the Reserve Bank of India, now it is Dhanlaxmi Bank that has increased its deposit rates across various maturity periods.

The bank has also introduced a new slab of 300 days that would attract an interest rate of 10.00%; also the lender is offering an extra interest rate of 0.50% to the senior citizens above the card rates but only on the maturity periods of 180 days and above (except on 300 days).

The revised deposit rates are applicable from 16^th August.

Hike in the deposit rates of Andhra Bank

As the lending rates are soaring so are the deposit rates, people are facing difficulties due to continuous hike in the loan interest rates but at the same time banks are attracting more and more people to invest with them through the term deposit schemes by offering irresistible deposit rates.

Andhra Bank has also done the same and has announced a hike in the fixed deposit rates across various maturity periods like for tenure of 46 to 90 days the deposit rate has been increased from 5% to 6%. The hike in deposit rates is made in the range of 0.25% to 1.00%.

The revised rates are applicable from 8^th August.