Special FD deadline nears, go for laddering

AS THE MARCH 31 deadline for investing in special fixed deposits (FDs) of some banks nears, laddering deposits is a smart way of staggering out investment with liquidity at regular intervals.

- SAIKAT NEOGI

The tenures of these deposits of State Bank of India, IDBI Bank and Indian Bank range 300-700 days, offering interest rates of 7.05-7.4% to the general public and an additional 50 basis points for senior citizens.

For instance, SBI's Amrit Kalash special FD is offering 7.1% interest on a tenure of 400 days. Senior citizens will get 50 basis points more.

The bank's Amrit Vrishti is offering 7.25% for 444 days. In contrast, for regular FDs, it offers 6.8% to the general public and 7.30% to senior citizens for a tenure of one year to less than two years.

As interest rates are likely to fall, locking money in special deposits with predefined tenures will help depositors align with short- to medium-term financial goals.