When considering making a fixed deposit in the State Bank of India, it’s important to know how many years it will take for your money to double. This can be calculated using the Rule of 72, which is a quick way to estimate the doubling time for an investment. Knowing this information is crucial, especially for individuals looking to save for the long term, as it helps ensure that the investment returns are significant.
State Bank of India (SBI) offers fixed deposits with maturity tenures ranging from 7 days to 10 years, with interest rates varying between 3.50 % and 7 % for general customers. Senior citizens are offered an additional 0.50 % interest. Moreover, Sarvotham provides an extra 0.30 % on a one-year tenure for non-callable domestic retail term deposits of Rs.1 crore to Rs.2 crore and 0.40 % more for a 2-year tenure.
The Rule of 72 can be applied to determine how many years it will take for an investment to double. For instance, if the interest rate is 7 %, dividing 72 by 7 gives a result of 10.3, meaning it will take approximately 10 years and 3 months for the investment to double. Similarly, for an interest rate of 7.5 %, dividing 72 by 7.5 gives 9.6, indicating that the investment will take around 9 years and 6 months to double.
Currently, SBI is offering 6.5 % interest to general customers and 7.5 % interest to senior citizens on a 10-year tenure. According to the rule of 72, if senior citizens deposit Rs. 5 lakh, they will receive Rs. 10 lakh. It can be inferred that if the same amount is invested by general customers, the return will be less than Rs. 10 lakh.
