HDFC Raises FD Interest Rates: Earn Up to 7.75% Return on Fixed Deposits

HDFC Bank has increased the interest rates on fixed deposits (FDs). There has been a revision in the interest rates on FDs of less than 2 crores. Now, regular citizens will get interest rates ranging from 3% to 7.25% on FDs in HDFC Bank. Meanwhile, senior citizens will earn interest rates ranging from 3.50% to 7.75%.

Earlier, even IndusInd Bank had increased its interest rates.

Previously, IndusInd Bank had also revised the interest rates on fixed deposits (FDs). For FDs in the bank, regular citizens were earning annual interest rates ranging from 3.50% to 7.75%. The bank offered senior citizens annual interest rates ranging from 4% to 8.25%. There has been a change in interest rates on FDs of less than 2 crores. The new rates have been effective from February 6th.

When considering investing in a Fixed Deposit (FD), it’s important to pay attention to the tenure chosen. This is because if depositors withdraw before the maturity period, they may incur penalties. If an FD is prematurely withdrawn, a penalty of up to 1% may be levied, potentially reducing the total interest earned on the deposit.

Therefore, it’s advisable not to invest all your money in one FD. If you’re contemplating investing 10 lakhs in any one bank, consider diversifying by investing 1 lakh each in 8 FDs and 50,000 each in 4 FDs across multiple banks. This way, you can mitigate risks and ensure that your funds remain secure.

Additionally, FDs with a tenure of 5 years are eligible for tax deductions. These are commonly known as Tax Saving FDs. By investing in such FDs and claiming deductions under Section 80C of the Income Tax Act, you can reduce your taxable income by up to 1.5 lakhs. In simpler terms, you can lower your taxable income by up to 1.5 lakhs using Section 80C deductions based on your total eligible income.