FD Interest Rate: Thanks to rising interest rates, fixed deposit (FD) investors are a happy lot. Interest rates of fixed deposits across tenures have gone up significantly over the past year. A handful of banks even offer an interest rate as high as 8 per cent on fixed deposits. Senior citizens usually get an additional interest rate of 0.50 per cent on FDs over the regular card rate.
If you are planning to book a fixed deposit, here are the best interest rates available on two-year deposits.
DCB Bank
DCB Bank offers the highest interest rate on fixed deposits maturing in two years. For deposits maturing between 700 days and 24 months, the bank offers an interest rate of 8 per cent. For senior citizens, the interest rate goes up to 8.5 per cent for deposits with a similar tenure.
YES Bank
YES Bank offers an interest of 7.75 per cent for deposits maturing between 18 months and 36 months. Senior citizen will earn an interest rate of 8.25 per cent for deposits maturing between 18 months and 36 months.
IDFC First Bank
IDFC First Bank also offers an interest rate of 7.75 per cent for deposits maturing in two years. For FDs maturing between 18 months and three years, the private bank offers an interest rate of 7.75 per cent. For senior citizens, the interest rate will go up to 8.25 per cent for fixed deposits maturing between 18 months and three years.
IndusInd Bank
IndusInd Bank offers an interest rate of 7.75 per cent for deposits maturing in two years. Senior citizens can get an interest rate of 8.25 per cent for fixed deposits maturing in two years.
How to choose a fixed deposit
“The first thing to focus on is a reliable scheduled bank so that the safety aspect is addressed. Then one should look at the tenure they want to invest for. If they just want to invest for getting decent returns consider special tenures offering good rates. Else go for relatively shorter tenures like two years. That way reinvestment of the maturity at that time can happen at potentially higher rates, as the interest rates are expected to go up further for a year or so,” said said Suresh Sadagopan, an RIA and founder of Ladder7 Financial Advisors.
“Ideally FD tenure should match ones investment horizon. Else, if one breaks the FD, one will get the return pertaining to that tenure. Proper planning and thought should hence go into this before investment,” he added.
Do remember that the interest earned on these fixed deposits is taxable as per the tax bracket of the investor.
