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Interested in Fixed Deposits? Here are Some Useful Tips.

Many people think that FDs (fixed deposits) are one of the safest investment options and they are right to a great extent. Yes, it is true that it is one of the safest investment option and you can earn good rate of interest on FD. But, before you invest find some quick tips here:
  • All FDs do not fall in 100% secure category- Corporate deposits may provide unsecured loans but they do not bear any promise to the investors. Instead of having a big fat FD try invest in multiple FDs as many banks offer credit guarantee and also deposit cover to its customers for deposits up to 1 lakh for every customer.
  • Laddered investment cycle can earn better benefits- This means that you split your investment money into parts and fix them with different banks and NBFCs under different terms and conditions in successive time periods, for example, you can split 3 lakhs into 3 different accounts for 1 year, the second for 2 years and the last for 3 years. This way your money will mature in consecutive years which you can reinvest for 3 or more years as well.

Read Also: Are Fixed Deposits Still Favorable Post Reduction in Interest Rates


  • It is essential to choose the right tenure and avoid premature penalty- You can do so by splitting your principal and invest in 3 to 4 different banks. In situations where you may need some cash you can break one FD and the rest of the FDs are intact.
  • Have a look at TDS and other tax laws before investing- Your investment is taxable if you earn an interest of more than Rs. 10000/-. To avoid that you can split your investments in such a way that they provide less than Rs. 10000/- returns on investment.
Consultation: This tutorial explained about the what you think keep in mind before investing your money in Fixed deposit investment scheme. There are lots of tips which you need to consider before opting FD.

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