LIC Fixed Deposit Scheme for Senior Citizens in 2023


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FDs or Fixed Deposits are among the safest kinds of investments that anyone can rely on. FDs for senior citizens is the best option for the elderly to trust on with their savings. In this post, we will take a look at the LIC FD schemes 2023 for the aged. 

Life Insurance Corporation (LIC) of India is the single largest public sector life insurance policy provider in India. The organization was founded in 1956 and has collaborated with 245 other insurers and prudent societies to become a conglomerate. LIC has its headquarters in Mumbai and they offer extensive products in the category of term plans, investment policies and saving plans among others. Being a public sector company, LIC is regarded as the most sought-after insurer among customers in both urban and rural areas.

LIC trades in NSE or National Stock Exchange as well as in Bombay Stock Exchange and is registered with the National Housing Bank. LIC HFL or LIC Housing Finance Limited, founded in 2007, is termed as among the largest Housing finance companies in India offering wide ranging FDs or Fixed Deposit plans to serve the needs of investors of all categories. The FDs offered by LIC are available with good return on investment along with several other benefits. Let us discuss below the LIC FD interest rates 2023 for senior citizens.

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LIC Fixed Deposit Scheme for Senior Citizens in 2023

FDs offered for senior citizens by LIC are the term deposit plans with lucrative LIC interest rates which cater to people above the age of 60. Offering a range of benefits to the elderly, senior citizen FDs allow regular payout to them along with handsome interest rates. Such benefits allow the elderly to have a steady flow of income in their late years of life.

Here are some benefits presented by LIC FD scheme for senior citizens:

  • These plans allow the elderly generation to enjoy special interest rates which help them to earn more
  • The senior citizens can receive the interest which they earn on the FDs as monthly pay to lead a comfortable life after getting retired
  • They can also enjoy tax savings u/s 80C of the IT Act
  • With the regular payout option, a retired person can lead a comfortable life by using it as a source of extra income
  • The term duration of LIC Housing Finance FDs starts at 36 months and goes up to 60 months
  • At present, the maximum interest rate offered on LIC HFL for senior citizens is 6%, which is payable with cumulative or non-cumulative term deposits of 3 to 5 years (for amounts below INR 20 Crores)

LIC Fixed Deposit Interest Rates 2023 for Senior Citizens 

The LIC FDs serve the senior citizens above the age of 60 years by offering a maximum interest rate as compared to the rates offered to general citizens.

Here are the LIC FD rates for Senior Citizens 2023:

Tenure of FD Interest rates for general citizens  Interest rates for senior citizens 
1 year 5.25% 5.50%
18 months 5.50% 5.75%
2-years 5.65% 5.90%
3-years 5.75% 6.00%
5-years 5.75% 6.00%

10 Key Features of LIC FD Interest Rates 2023

Below are some key elements of LIC FD interest rates 2023:

  1. The LIC FD account can be opened with a small sum of money with no upper limit
  2. To avail the monthly pay option, the minimum investment amount to be deposited is INR 2 lakh
  3. However, INR 10,000 is the minimum amount to be deposited to get payout on yearly basis
  4. Further, added amount can be deposited in multiples of INR 10,000 for a monthly and INR 1,000 for a yearly deposit
  5. The tenure of the FD is 18 months to 5 years
  6. The plans offer nomination facility
  7. Loan is also available against the FD offered by LIC Housing Finance
  8. Under this scheme, a part of the deposit can be withdrawn if there is an urgent need
  9. It also allows the option to have automatic renewal once the amount matures
  10. Interest rate for Senior Citizens FDs is between 5.50% to 6.00 % pa

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Added Features of LIC FD Deposit Scheme 

LIC Housing Finance does not allow the option of depositing any added amount in an FD that is already active. However, if you want to add more money to FD, you can open a new FD account and deposit the extra money in it. The safety of the LIC FDs is confirmed by an AAA or AA rating offered by agencies to indicate its high safety assurance.

Tax Benefits and TDS 

LIC FD Deposit Scheme for Senior Citizens provides tax benefits under section 80C of the Income Tax Act, 1961, if the term duration is of 5 years and above. Depositors are allowed to claim the exemption when filing the returns of income tax. Also, a TDS of 10% is deducted in case the interest income exceeds INR 4 to 5 lakhs for Senior Citizens.

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Factors affecting LIC FD interest rates for Senior Citizen 

There are various external and internal factors on which LIC FD rates depend. Some of them are:

  • RBI or Reserve Bank of India strategies
  • Socio/economic conditions
  • Market fluctuations
  • Liquidity position of LIC etc.

Inflation is one of the primary factors which regulates the LIC FD rates as well as the FD rates of other banks. Similarly, policies and guidelines by RBI also play an important role in the rate of interest of FDs.  The economic situations in the country are another vital factor that influences the interest rates of FDs offered by LIC and other financial institutions/banks.

Eligibility criteria to open an FD account for senior citizens with LIC

LIC FD account can be availed by :

  • Individuals as well as minors, or as a joint account with a custodian
  • Partnership organizations
  • NRIs
  • Trusts, clubs, and associations
  • HUF i.e., Hindu Undivided Families
  • Joint Stock Companies
  • Sole Proprietors etc.

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Documents Required to Open an FD account with LIC

Here are the documents required:

  • Form of application
  • Two copies of photograph of the investor
  • Proof of address
  • Proof of identity
  • PAN card
  • Form 60/61
  • Aadhar Card

To Conclude

LIC is India’s top and biggest insurer offering FDs for people of different age groups. Elderly citizens above the age of 60 years can avail the LIC FD for Senior Citizen schemes. They come with good interest rates so that the senior citizens can spend their retired life without any financial difficulty.

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FAQs: LIC Fixed Deposit (FD) Scheme for Senior Citizens in 2023

Does LIC have a fixed deposit scheme?

Yes, LIC offers FD schemes. LIC Housing Finance Ltd. has launched SANCHAY deposit scheme in May 2007

Do senior citizens get any extra benefit on the FD?

Yes, they get special interest rates, can avail payout on a monthly basis, and can gain tax benefits.

Is investing in LIC better than FD?

Both are different products. FD is purely an investment product whereas life insurance is an insurance product. So, both have their unique benefits as well.

Which LIC policy gives monthly returns?

There are many LIC Fixed Deposit Monthly Income Plans offered by the insurer. You can have a look at these plans in the LIC fixed deposit plan chart to choose your plan accordingly.

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May 15, 2023
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PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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