How fixed deposit interest rates affect your monthly income plans

 

Fixed deposit interest rates play a crucial role in shaping the monthly income plans of many investors, especially retirees and conservative savers. Understanding how these rates influence your returns helps in optimising your investment strategy for stable and predictable income. For instance, if you have a 2 lakh fixed deposit interest per month target, knowing the impact of interest rates can determine whether your corpus meets your financial needs. In this context, Bajaj Finance FD stands out as a reliable product offering competitive interest rates paired with flexible tenures and payout options.

Understanding fixed deposit interest rates in India

Fixed deposit interest rates represent the annualised return paid by banks and Non-Banking Finance Companies (NBFCs) on your invested amount. These rates vary based on tenure, age category (senior citizen or non-senior citizen), and deposit type. For senior citizens investing with Bajaj Finance FD, the interest rates are higher compared to non-senior citizens, reflecting the government’s priority to support retired individuals.

Here’s a snapshot of the current Bajaj Finance FD rates for senior citizens and non-senior citizens for popular tenures:

- Senior citizens (24-60 months): 7.30% p.a. (at maturity), 7.07% p.a. (monthly payout)

- Non-senior citizens (24-60 months): 6.95% p.a. (at maturity), 6.74% p.a. (monthly payout)

These rates determine how much income you earn through interests over your chosen tenure.

Calculating Rs. 2 lakh fixed deposit interest per month

To illustrate the influence of fixed deposit interest rates on your monthly income, let’s calculate how much principal is needed to earn Rs. 2 lakh fixed deposit interest per month.

Assuming you opt for a senior citizen fixed deposit with a monthly interest rate of 7.07% p.a. from Bajaj Finance FD for a 24-60 month tenure, the approximate investment required would be:

- Annual interest required = Rs. 2,00,000 * 12 = Rs. 24,00,000

- Required principal = Annual interest / Interest rate = Rs. 24,00,000 / 0.0707 ≈ Rs. 3.39 crores

Similarly, for a non-senior citizen earning monthly interest of 6.74% p.a., the required principal is approximately Rs. 3.56 crores.

This calculation clearly shows how interest rates directly influence the capital you need to generate a fixed monthly income target.

Conclusion

Fixed deposit interest rates significantly affect your monthly income plans by determining the return on your invested corpus. Whether you aim for a 2 lakh fixed deposit interest per month or a smaller sum, understanding these rates helps plan better and avoid shortfalls. Bajaj Finance FD offers transparent and competitive interest rates, especially beneficial for senior citizens, along with flexible monthly payout options that make it an ideal product to structure your fixed income.