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Secure Your Future through Fixed Deposits

It goes without saying that investing in a Fixed Deposit is one of the most safest and easiest ways to park your money. A Fixed Deposit is a type of investment where your money is invested for a specific tenure, and you get interest benefits on it at the end of the tenure. This feature makes FDs a preferred mode of investment among youngsters and experienced working professionals alike.

A few salient features of opening an FD account are:

It is Risk Free

risk free fd

If you compare Fixed Deposits with other modes of investments like, real estate, shares, or chit funds, FD are considerably risk-free. As a matter of fact, Fixed Deposits are the safest type of investment, which amounts to quite a large sum at the close of its maturity period.

It Gives you High Returns

Just like with savings account, banks and NBFCs provide interests on FDs as well. However, the only difference here is that, while you can withdraw money from a savings account anytime, you can’t do the same with an FD account. Because of this, the interest earned on a Fixed Deposit is higher than that of a savings account.

High Return

By charging a penalty on breaking an FD, this investment type not only provides you more interest, but also paves the way for a financially secure future. The principal amount should be kept as it is, but you’re eligible to withdraw the interest income on periodic basis such as, monthly, quarterly, or yearly. But, to get the most out of your FD, it is advised to withdraw from it only after maturity, as this will give you better interest rates.

It can be Easily Withdrawn

If you’re facing an emergency, such as an illness, marriage, or loss in business, where you need immediate financial assistance, you can easily withdraw money from your Fixed Deposit account to address these emergencies. That being said, keep in mind you might face a slight penalty to do so, which is usually 1-2% interest of the Fixed Deposit rates. This feature undisputedly makes FDs a better choice over any other mode of investment, because at the end of the day, all you’re losing is a little interest.

It can be Opened without Much Cash

To open an FD account with a national bank, you’d be required to deposit a minimum of Rs. 100. Whereas, in case of private banks and NBFCs, you’d be depositing a minimum sum of Rs. 500. Therefore, by opening a Fixed Deposit account for a fixed tenure, you’re actually investing in a financial future that is safe and secure.

fixed deposit account

All these qualities make Fixed Deposits a better choice of investment. However, you should look closely at the tenure of an FD before investing in it, because withdrawing money before maturity attracts penalty, which is something any investor would want to avoid. You can determine your maturity amount with the help of FD rate calculator.

Written By

Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness.

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