₹5 Lakh FD Interest

Create a stable income from your investment by placing your money in a fixed deposit. This low-risk investment scheme is a safe way to preserve your funds. Although the interest on a ₹5 lakh FD for 1 year varies, you should always check the current rate to make a sound investment. People who need regular returns from their investments, such as retirees or those who have extra money but limited income sources, should consider a monthly FD scheme. You should choose a ₹5 lakh FD and obtain your monthly returns to make sure your income is monthly and stable throughout the year.

Please continue reading to learn the interest you can get each month from major lenders on a ₹5 lakh FD.

Monthly Interest Rate on ₹5 lakh Fixed Deposit

Here is an example, the below table represents the monthly income generated from a fixed deposit of ₹5 lakh, with interest rates varying from 4% to 10% per annum.

5 Lakh FD Interest Per Month by Banks & NBFCs

Varied FD interest rates are offered by different banks and NBFCs. Compare earnings based on the interest rates of Public Sector Banks, Private Sector Banks, Small Finance Banks, and NBFCs.

Monthly Interest on ₹5 Lakh FD By Public Sector Banks

Monthly Interest on ₹5 Lakh FD By Private Sector Banks

Monthly Interest on ₹5 Lakh FD By Small Finance Banks

Monthly Interest on ₹5 Lakh FD By NBFCs

Compare FD Interest Rates From Top Lenders

Before investing in a Fixed Deposit (FD), you should research thoroughly and pick the lender that best fits your financial needs. Here is a list of FD interest rates from top lenders:

FD Calculator

An FD (Fixed Deposit) calculator is a tool that calculates the maturity value of an investment. The maturity value depends on factors like the investment period, interest rate, and investment amount. The frequency of interest compounding (yearly, half-yearly, quarterly, or monthly) also impacts the final amount. It's important to understand the terms and conditions of the FD agreement with the bank to know the services provided.

Things to Note Before Investing in ₹5 Lakh FD

If you are considering a heavy investment such as a ₹5 lakh Fixed Deposit, there are a few factors to consider before opting for it. Having a clear understanding of the guiding principles will help you make a right choice and help you reach your financial goals.

Here are a few considerations to keep in mind:

• Interest Rate: It is recommended to choose a bank with the best return for the FD as different banks offer different rates.
• Tenure: Select the period of FD based on your financial goal and liquidity requirement.
• Safety: Choose a bank that has a good reputation as the amount deposited in FD in any bank is insured by the DICGC up to Rs.5 lakh per depositor per bank.
• Interest Payment: Choose the period of interest payments as per your income requirement.
• Tax Implication: While calculating your return on the FD make sure that you have taken into account the tax factor, as the interest earned from Fixed deposits is taxable.
• Premature Withdrawal: Make sure that you are aware of the bank’s policy on FD premature withdrawals.

Benefits of Monthly Income Fixed Deposits

Monthly Income Fixed Deposits provide a dependable way to earn regular income while safeguarding your investment. With this type of FD, you get monthly interest payments, ensuring financial steadiness and flexibility. The main benefits are:

• Regular Income Stream: Monthly income FDs provide a regular stream of income every month to the depositors. These are particularly helpful for those who want a periodic flow of funds to meet their regular expenditures.
• Higher Returns: Your monthly income FDs have higher interest rates than the regular FDs. The interest rate would be compounded more frequently and through the tenure, the depositors can realize a higher return.
• Disciplined Saving: As the frequency of payouts is more, FD interest rates can encourage a habit of saving in depositors. The amount paid out can either be reinvested at the same interest rate or can be used for other purpose also.
• Tax Benefit: The withdrawn monthly interest is taxable in the interest of tax planning and management of tax liability. These FD deposits are especially useful.
• Liquidity: In most banks, the monthly interest FDs can be withdrawn with premature payment. In case of emergencies, depositors can realize liquidity when the amounts are not available.

How to Open an FD Account For ₹5 Lakh

To open an FD account, both online and offline channels can be used. The typical steps to follow when opening an FD account for ₹5 lakh are as follows:

Online:

• Step1: Log in to your online bank account and find the option for fixed deposits.
• Step 2: Choose the open FD option and continue to accurately fill out the online application form.

Offline:

• Step 1: Head to the closest branch of your bank or financial institution.
• Step 2: Fill out the paper application form accurately.
• Step 3: Attach the necessary documents to the application form and submit them.
• Step 4: Deposit the FD amount as cash or cheque.