The myth of ‘Either or Survivor’ in Bank FD

General
1

Depositors tend to blindly follow the “Either or Survivor” clause as operating guidelines by operating staff at branches. It means that a large majority customers opt for “Either or Survivor” clause as they are guided by bank staff.

The understanding that on the death of a joint-holder, the surviving joint-holder gets the proceeds of the FD has turned out to be a myth.

As per the article, the survivor i.e the joint holder cannot liquidate the FD prematurely until there is a clause as stipulated in the FD account opening form to do so. The only option is to let the FD run the entire term and once matured, the survivor or joint account holder can take the money.

This is truly crazy. I always thought EorS was a fool proof method to ensure that the joint holder gets the money

Please do read the article in case you have FD in joint names. I learnt something new.

2 Likes
2

Banks have so many clauses and terms and conditions, i am thinking of taking a lawyer with me while opening a FD next time.

1 Like
3

Banks are million times better than Trading… (my view only)

4

I agree, i have never lost money in Banks yet.

5

How could you compare an institution with an activity?

Banking is not an activity, unless we are bankers. Even if we are, there is someone above who tells us what to do.

Trading is an activity, our own activity, where we are everything, right from the origination of thought to filing taxes.

There is RBI which can help us with our losses, there is no such authority if we face losses in trading :face_in_clouds:

6

Please let me compare bro. Why you put water on my comparison.

I would say opening FD and collecting interest as activity.

Zerodha helps me in trading, Zerodha doesn’t let me trade once i have no money left in trading account.

7

Sure, if you consider watching paint dry is an activity :roll_eyes:

You should know when to leave, you should not be told to leave :grin:

Glass empty, head getting heavier, time to leave :beer:

8

Sitting idle is also an activity.

They dont tell me to leave. I leave because i cant trade.

Sorry i am sober, have been since long time. No money to party. :face_holding_back_tears:

9

Then meditate, get focused, get your strength back, and get back into the ring, your country is looking at you, you are their hero :boxing_glove:

10

Sir. It was a joke between me and him. Did not do any iron corridor analysis or used straddle strategy or any other thing. It was just an impromptu reply to him. Next time i will put a disclaimer as well.

Now dont ask what iron corridor or straddle or God knows what???actually means. I was just pulling his leg.

1 Like
11

Hmmm.

Must have read it wrong then :man_facepalming:

And my replies for the most part are impromptu too, so I was not serious either.

1 Like
12

Please don’t, that will spoil the joke.

Edit: Maybe add jk, for non humor people to understand.

13

Perhaps it is better if those non humor people refrain from posting, or better yet stop reading :+1:

1 Like
14

Thank you so much @neha1101 for informing us about this important observation. This is totally new for me.

15

Is that same if FD owner is dead and nominee can’t prematurely close & withdraw?

16

Registered nominee is valid. The article is talking about only when you have a Joint FD in two names with EorS clause. Say the tenor of FD is 5 years from today. If one of the joint holder dies before the maturity of the deposit, the joint holder even though the FD was opened Eor S cannot close the Deposit. The money is not lost though, it will be given back to the joint holder only on the maturity of the FD and not before i.e after 5 years.

What they are saying is in case of Joint FD with Either or Survior clause, it seems, there is clause which stipulates that the survivor joint holder can get the FD amount any time. This clause is generally not signed off due to lack of knowledge when FD are opened and hence on death when the joint holder approach the bank to preclose the FD, when the bank realise that this clause was not there when the FD was opened will reject or refuse to pre close the FD.

If the FD is in single name and a nominee is registered, there is no issue. This will arise only if you hold a Joint FD.