Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation for their services. It is available to employees who have completed a minimum of five years of continuous service with the employer. Gratuity is typically calculated as 15 days of basic salary for every completed year of service.
Investing gratuity funds in Fixed Deposits (FD) is a popular investment option among employees. FDs are a safe and secure investment option that offers guaranteed returns. Amidst the ever-changing market scenarios, FDs offer stability by being unaffected by fluctuations in the market.
Using gratuity for FD: How does it work?
When an employee receives a gratuity, they can choose to invest the amount in an FD. The interest rate on FDs is generally higher and lasts for a fixed period. The investment tenure can range from a few months to several years, depending on the investor's preference.
Why should you invest your gratuity in FDs?
- The most significant advantage of investing your gratuity amount in FDs is the safety and security it provides. FDs are a risk-free investment option as they are not subject to market fluctuations. The Bajaj Finance FD has one of the highest stability ratings in the market and hence ensures the safety of your deposit.
- Another advantage of investing gratuity funds in FDs is the predictable nature of returns. The interest rate on FD is fixed at the time of investment and does not fluctuate during the investment tenure, helping investors plan their finances better. This will keep your money working for you without you worrying about it.
- If you are interested in making a regular income from your gratuity lumpsum and yet have your principal amount intact, FD is the best way since you can choose a non-cumulative FD option, and your interest gets paid out as per the payout option chosen. Bajaj Finance FDs have flexible payout options ranging from monthly to yearly, which makes them ideal for short-term goals.
- Bajaj Finance FDs come with a very competitive interest rate, and yet, give up to 0.40% p.a. higher interest rate to senior citizens compared to the regular rates. This comes as an incentive for anyone who is looking to invest, is a senior citizen, and wants the best from their investments.
- Bajaj Finance FDs come with the benefit of special tenures. Apart from the regular investment tenure, there are special tenures of 18, 22, 33, 42 and 44 months which bring in higher returns. This feature maximises the potential returns your gratuity amount can fetch after being invested in a Bajaj Finance FD.
Look at the two tables below to understand the difference in interest rates between regular tenure and special tenure. The data captured here is for senior citizens.
Interest rates for senior citizens for regular tenure
| Tenure in months |
At maturity (p.a.) | Monthly (p.a.) | Quarterly (p.a.) | Half yearly (p.a.) | Annual (p.a.) |
| 12 - 14 | 7.65% | 7.39% | 7.44% | 7.51% | 7.65% |
| >15-23 | 7.75% | 7.49% | 7.53% | 7.61% | 7.75% |
| 24 | 8.20% | 7.91% | 7.96% | 8.04% | 8.20% |
| 25 - 35 | 8.20% | 7.91% | 7.96% | 8.04% | 8.20% |
| 36 - 60 | 8.35% | 8.05% | 8.10% | 8.18% | 8.35% |
Interest rates for senior citizens for special tenure
| Tenure in months |
At maturity (p.a.) | Monthly (p.a.) | Quarterly (p.a.) | Half yearly (p.a.) | Annual (p.a.) |
| 15* | 7.70% | 7.44% | 7.49% | 7.56% | 7.70% |
| 18* | 8.05% | 7.77% | 7.82% | 7.89% | 8.05% |
| 22* | 8.15% | 7.86% | 7.91% | 7.99% | 8.15% |
| 30* | 7.70% | 7.44% | 7.49% | 7.56% | 7.70% |
| 33* | 8.35% | 8.05% | 8.10% | 8.18% | 8.35% |
| 42* | 8.65% | 8.33% | 8.38% | 8.47% | 8.65% |
| 44* | 8.50% | 8.19% | 8.24% | 8.33% | 8.50% |
The benefit of safety, security, predictability, flexibility, and higher returns make fixed deposits an ideal investment option for your gratuity money. Moreover, Bajaj Finance offers high FD rates, making it a perfect option for those looking to invest. With the convenience of online FD booking and the use of an FD calculator, investing in FD with Bajaj Finance has never been easier.
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