For individuals seeking a secure and reliable way to grow their savings, Fixed Deposit (FD) schemes have always been a preferred choice. Adding to this trust, LIC Housing Finance Limited has introduced a compelling Fixed Deposit plan designed to offer stable monthly returns with minimal risk. This initiative provides an excellent opportunity for investors to earn a regular income, backed by the credibility of a well-established financial institution.
Understanding the LIC Housing Finance FD Scheme
This Fixed Deposit offering is managed by LIC Housing Finance Ltd., a trusted name in the financial sector. It is an ideal savings instrument for those who prioritize safety while seeking attractive, fixed returns on their investment. The scheme allows individuals to deposit a lump sum amount for a predetermined period, earning a guaranteed interest rate throughout the term.
Key Features of the Scheme
The scheme stands out due to its competitive interest rates, which currently range between 7.25% per annum and 7.75% per annum. Senior citizens are eligible for an additional 0.25% to 0.50% interest, making it an even more attractive option for retirees. The most notable aspect is that the interest earned can be paid out monthly, providing a steady source of income. For instance, an investment of ₹1.5 lakh at an approximate annual interest rate of 7.62% could provide a monthly income of around ₹9,525, offering financial ease to the investor.
Investment Amount and Tenure
To start an FD under this scheme, the minimum investment required is ₹1,00,000. There is no specified upper limit, allowing investors to deposit larger sums according to their financial capacity. The tenure for these deposits is flexible, ranging from as short as one year up to five years, enabling investors to select a period that aligns with their long-term financial objectives.
Tax Benefits Associated with the FD
Investors can avail themselves of tax benefits under Section 80C of the Income Tax Act for investments up to ₹1.5 lakh in a financial year. Furthermore, if the total annual interest income is below ₹40,000 (₹50,000 for senior citizens), individuals can submit Form 15G or 15H to avoid Tax Deducted at Source (TDS) on their interest earnings.
Documents Required for Investment
The process of investing is straightforward. Applicants need to provide basic KYC documents, including a government-issued identity proof (like Aadhaar, Voter ID, or Passport), address verification, a PAN card, a recent passport-sized photograph, and bank account details for transaction purposes.
How to Apply for the Scheme
Interested individuals can visit their nearest LIC Housing Finance branch to apply. The process involves filling out the application form, submitting the necessary documents, and making the investment via cheque, demand draft, or online transfer. Upon successful deposit, the investor receives a Fixed Deposit certificate as proof of their investment.
Loan Facility and Premature Withdrawal
The scheme also offers a loan facility against the FD after six months, providing liquidity in case of urgent financial needs without having to break the deposit. While premature withdrawal is permitted after three months, it may attract a lower interest rate. It is important to note that if the FD is withdrawn within the first six months, no interest will be paid, so investors are encouraged to consider the tenure carefully.
This FD scheme from LIC Housing Finance emerges as a secure and beneficial financial tool for those looking to generate a predictable monthly income while ensuring the safety of their capital.
