Fixed Deposit are arguably the most underappreciated kind of investment, and very little is said about the choice anyone makes to invest in Fixed Deposit.
Besides the safety and benefits you get from Fixed Deposits, there’s also lowered risk.
Here are a few highlighted features of a Fixed Deposit account in regards to returns from Fixed Deposits, and other handy information. Once you understand what an FD has to offer, you might just have an additional investment avenue, and a solid earner at that!
If you’re looking for a reason to invest in FD, look no further.
Why are Fixed Deposit Accounts Popular?
A Fixed Deposit (FD) is often hailed as one of the safest investment options available to investors in India today. Additionally, the interest earning on Fixed Deposit is another reason you should opt for a Fixed Deposit account.
If you’re worried about any fine print, you should know that you can find out the exact amount you will get in return upon maturity. Provided your interest rate is fixed, as it is here. There are a lot of other benefits that you may not even have considered.
Some of the prominent drawbacks, however, include a high rate of inflation. This seems to be the case for the past few years, and the amount that is taxed on the amount of interest you earn. Read on, and you’ll see why and how you must make every arrangement necessary to maximise the returns from your FD.
How You Can Maximise Your Earnings
- Research Your Options
With so much variety and differences in FD schemes available to you, it is in your power to make a choice, keeping in mind the benefits from each of these options.
Consider the different Fixed Deposit schemes, and the benefits and drawbacks of each. Since your goal is a higher income and more benefit, then look at it from that angle. In this context, tenure and interest rates become indispensable features that you cannot ignore. Interest rates will vary greatly depending on the lender you pick.
If you decide upon a tenure, you can calculate the interest rate. So, pick the lender that offers the highest interest rate; this way, you can reap maximum profits. You can use fd calculator to calculate your interest rate monthly, quarterly, half-yearly or annually.
Bajaj Finserv, for example, gives you great interest rates, and also offers considerable security you on your precious investment.
- Split The Earnings To Evade Taxation
It is general knowledge that, if and when your interest earnings go beyond Rs.10,000, you will be charged a 10% TDS, which is Tax Deducted at Source. Some people choose to avoid this taxation, by simply splitting the investment in the FD. A good way of doing this is opening multiple FD accounts in NBFCs, and then splitting the invested amount.
This also gives you the benefit of not having to break your entire investment, and losing your profit just because you need emergency funds. If you have multiple accounts with small investments, you’ll end up breaking only one or two of those, still earning an interest from the other accounts.
Keeping these tips in mind, you can invest in Fixed Deposits and earn quite the profit. Besides, Fixed Deposits investments are only going to get better when inflation rates come back to normal.