Fixed deposits are the safest place to invest your money. There is no need to worry about market risks. That is because you can be assured of a predetermined return upon maturity.
You can fulfill your long-term financial goals with fixed deposits.
Whether it is your children’s marriage, higher education, or a long trip, fixed deposits will always have your back.
Moreover, it becomes easier to plan since you know the exact date of maturity. However, what are the things you must know before investing in an FD? Let’s take a look.
1. What is the Minimum Amount for FD?
Before investing, you must know the minimum amount for FD. Most lenders accept a minimum deposit of Rs 10000.
However, some online fixed deposit schemes might let you invest a lesser amount.
If you are opting for a monthly income scheme, you will need to deposit a higher amount. A monthly income scheme pays off your interest every month instead of waiting for maturity.
2. Choose Between A Cumulative And Non-Cumulative Deposit
If you want to withdraw the money at maturity, you can go for a cumulative deposit.
Here your interest will get compounded after specific intervals. But, if you are looking for some monthly income options, you can go for a non-cumulative deposit.
In that case, you will receive your interest payments monthly. You can also opt for quarterly or half-yearly interest payments.
3. Opening A Fixed Deposit Account
It is super easy to open an FD account with the bank where you have your savings account. That will hardly take a few moments. However, you can also open an account somewhere else. You just need to go through the KYC process.
You can also open a fixed deposit account with an NBFC or housing finance company.
4. Tenure of Your Fixed Deposit
The fixed deposit tenure plays a vital part in determining your returns. The minimum period is 7 days.
You can also open an account for 10 years or more. It is better to go for a higher tenure. That will earn higher interest for you.
If you withdraw the money before maturity, you might get penalized. The bank will deduct a part of the interest.
5. Fixed Deposit Interest Rates
Compare the rate of interest offered by different banks and financial institutions. That will let you get the highest FD rates in India. The interest rates generally range from 5% to 6.75% per annum.
However, it might vary depending on the institution. Moreover, senior citizens get a slightly higher interest rate.
The Bottom Line
Fixed Deposits can help you secure your future. However, you must do your research well before investing your hard-earned money. Make sure your money is protected. PNB Housing offers one of the highest interest rates on FDs.
Moreover, opening an account is super simple. So, don’t wait any further. Let your money grow and meet your financial goals.