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Why Indians Prefer Investing In Fixed Deposits

Welcome to the world of FDs. In a country where banks are often disappointing with their offer of loans, the fixed deposit or FD has come to be seen as the custodian for your hard-earned money. Its popularity is unmatched in all aspects. The rate of interest on these deposits ranges from just 1% to 20%, depending upon the tenure of the deposit and your financial situation at that point in time.

Decent and steady returns

FDs return on your investment. They are designed to ensure you receive interest payment at a predefined interval determined by you. FDs are available in banks and financial institutions. Investors receive returns from their investments, which are fixed and dependable in nature unlike stock market and bond markets.

If you’re looking for a stable savings program, consider investing in a post office fixed deposit. These FDs are issued by the Indian Postal Services and offer excellent interest rates. The Government of India backs these investments, so they’re secure ways to earn consistent returns over the life of your term deposit.

Acts as a source of income for retired personnel

Are you worried about inflation and interest rates? If yes, then investing in Fixed Deposit is definitely for you. In this article, we will give you important information about FDs.

Cumulative FDs are similar to non-cumulative deposits, but instead of having a fixed term, they generate interest after they’re opened. If a cumulative FD is not able to provide you with earnings, it will pay out new cash in its entirety. Depositing money into these types of investments generates earnings for your account at the end of each year. Interest is added up and eventually paid back when your investment matures.

With the growing number of elderly households, the demand for fixed deposits is rising. However, it is not easy to find a high-yield savings product or even bank accounts that offer interest rates above 4%. The good news is that some senior citizens have found an investment opportunity beyond their comfort zone—condos with artificially low prices!

Fixed deposit interest is known to be higher than the interest offered in other investment options. Fixed deposits are a traditional favourite for senior citizens who prefer to invest in fixed financial assets, over time. They can also avail of an extra interest rate on their deposit.

Liquid investment

FDs offer higher rates of interest compared to savings bank accounts and regular savings accounts. The rate of interest differs between banks and financial institutions, but it ranges from 1% to 6%. If you need to withdraw your FDs temporarily due to a financial emergency, the penalty for premature withdrawal is usually very high. You need to calculate the penalty on top of your actual capital loss when withdrawing early from a fixed deposit.

Flexible tenures

In the modern world of finances, more and more people have started to look into fixed deposit. These time deposits offer flexibility in investment, suiting finance needs of all kinds. With an investment tenure ranging anywhere between 7 days to 10 years, FDs offer an alternative to traditional savings accounts or fixed deposits. Once you choose a term, you can use an FD calculator to determine your returns and plan your future finances accordingly!

Over to you

Fixed deposits offer you peace of mind. As long as the fixed deposit is fully grown over a period of time, your principal amount will be kept safe. With FDs, there’s no market volatility or excitement to worry about; this ensures that you can have fun with your money!

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