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What is a Fixed Deposit?
Fixed deposit (FD) is one of the safest investment options through which people can earn relatively higher interest in comparison to a regular savings account. Interest is accumulated on the deposited amount over a fixed period of time. The interest rate depends on the type of lenders (public sector, private sector, or small finance banks). Senior citizens are usually offered higher interest rates. In the case of an emergency, you can easily liquidate your FD and get the funds.
The tenures in fixed deposit schemes are flexible. Investors can choose the tenure according to their convenience.
Once the amount has been deposited in at a specific interest rate, it remains unaffected by further changes in interest rates or market fluctuations. Thus, the returns on your deposit are assured.
With fixed deposits, there are several other benefits such as loan against FD. One can avail loans of up to 90 per cent of your deposit amount at very low interest rates. Investing in tax-saving fixed deposits will fetch tax deductions. FD also provides the option for regular income. One can get the interest sum credited as per the requirements on a monthly, quarterly, or annual basis.
Factors to consider before opening FD -
- Compare various FD interest rates of different banks that help you earn better interest.
- Review the credibility of the lender by examining the fixed deposit’s safety.
- Choose a bank that offers good customer service and a hassle-free process for opening an FD.
Latest Updates on Fixed Deposit
The return on post office term deposits of two years under the small savings schemes is 6.9 per cent, the same as offered by most banks on deposits of similar maturity
In the bulletin, the RBI said that the Indian economy is unlikely to face any major repercussions from the ongoing global financial turmoil
Company is losing balances in savings as well as fixed deposits to competitors, it says
The rate on 12-month deposit would be increased to 7.20%, 7.50% for a tenure of 24 months and for 36 months it would be 7.50%
The revised rates will be effective from December 12
Lock into one-two year FDs and continue laddering, say experts
Revised rates applicable on fresh deposits and renewals
While you may begin allocating to them, keep some powder dry as rates could rise further
Rate applicable to both fresh deposits and renewals of up to Rs 2 crore for a tenure of 600 days, seniors to get 0.5% more
For 1 year to less than 2 years, SBI is offering 6.10% as compared to 5.60% earlier
For tax-efficient exposure, go for TMFs maturing in 2026-2028
The YTM of most debt funds tops 6.5%, indicating that they can at least do better than FDs in the near future
For periods longer than 3 years, it is a good idea to explore debt mutual funds that offer indexation benefits and lower the tax outgo
The sharp reversal in the interest rate regime by global central banks and high inflation has eroded returns from equities. Where should an investor, with a surplus investable amount, put their money?
Court permits Xiongwei Li to travel abroad after providing a FDR of Rs 5 crore
Since predicting peak rate is impossible, deploy in tranches over the next few months
The CBI on Wednesday visited Mondal's Nichupatti residence in Bolpur to question his daughter but left within 10 minutes after Sukanya refused to talk to them.
Debt fund investors should keep the bulk of their investments in shorter-duration funds, 10-20% in longer-duration ones
Check the return for your age, tenure, and premium variant, and if proceeds will be tax-free
Investors who want to avoid their long lock-in can choose from a host of other high credit quality options