Here is How you Can Earn More on FD Investment

Investing your money than saving it can be a better option when you have a surplus income coming in. Saving your funds won’t give you extra returns but investing can. Many opt for investments as it helps you in having more future funds if you have a house or a car to buy.

There are many options wherein one can invest: purchasing gold, mutual funds, fixed deposits, shares and much more. Investing is always a better option as it helps you in replication of your fund.  Purchasing gold can be a good investment if you wish to sell it in future in case of an emergency to get some funds. Mutual funds can be your option when you want higher returns on your investments. But these options have risk associated with them, as they offer you high returns to your investments.

Investing in FD can be the best option if you want less risk involved in your investments and also wish to have more returns over them. Fixed deposits are the easiest and a commonly preferred way to save some funds in India. Fixed deposits are measured as a safer option as compared to the stock market and mutual funds. Term deposits can be of two types: fixed deposits and recurring deposits.

Fixed deposits are a onetime investment option where you will devote all your funds at a single time. If you opt for recurring deposits, you will have to invest your funds regularly over a period of time. The procedure of the fixed deposit is very easy and it is considered extremely secure.

Many banks, as well as Non-Banking Financial Companies (NBFCs), offer fixed deposit to the one who wishes to invest their funds. Whereas banks are considered a safer option, NBFCs can be a little risky to invest in. The interest rates offered on fixed deposits are high which helps you earn high returns on your investments. So opening an FD account can anytime offer you with a good set of returns with low-risk involvement.

FD offers you with an overdraft facility in case you need your funds in an emergency. Overdrafts allow you to withdraw your funds without breaking your fixed deposit account. Also, this does not decrease your interest rate in the future. But you need to remember that you have to pay off your overdraft amount with interest on the last date of tenure.

As more is always less, who doesn’t like earning some more extra returns?

Investing in NBFCs can help you earn high rate of interest on fixed deposit. The rate of interest offered by NBFCs on fixed deposits is much high compared to normal banks FD. The RBI has agreed to offer 12 percent of the rate of interest by NBFCs to their investors in fixed deposits. Whereas normal banks offer 9 percent of interest rates to their fixed deposit investors.

Investing in an NBFCs fixed deposit can get you extra funds. But NBFCs have risk involved in them as they are not a bank and relying on them can get difficult. It’s important to check the background and also the ratings of NBFCs as it can be a scam and you don’t want to lose all your hard earned money.

Read about: Best Use of an FD and the Interest Earned from it