Investment start with Fixed Deposit

Fixed Deposit  is a financial instrument issued by Banks or NBFC’s . Investor get higher rate of interest than a regular savings account, until the maturity date. Fixed Deposit is very popular way to save money in India. They are safe Investment and its offer guaranteed return .

So, fixed deposit is a financial instrument which offer higher return , grater flexibility  and safety of investor money.

Key feature of Fixed Deposit :

Ø  Tenure : 7 Days to 10 years

Ø  The Interest is taxable under  Tax Deducted at Source (TDS) of the Income tax Act , 1961

Ø  Bank do not deduct TDS if your Interest on fixed deposit is less than 40,000 in a year.

Ø  If  your net income does not  exit taxable limit , you can apply for tax exemption by submitting Form 15G or 15H

Ø  Many Banks offer Loans Or Overdraft which can be availed against Fixed Deposit

Ø  Investor can choose frequency of interest pay out:

·         Cumulative Fixed  Deposit – Interest paid on maturity

·         Non-cumulative deposit  - Monthly/Quarterly/Half-Yearly/Yearly pay out

Ø  You can also avail nomination facility for certain Term deposit scheme .

Ø  Most of the bank  usually charge penalty of 0.5% to 1% for prematurely withdrawing an FD. But you cannot be prematurely withdraw from a Tax Saver FD before completing the 5 year lock in period.

Ø  Fixed deposit investment can vary from one bank  to  other. some bank provide minimum fixed deposit of Rs 100 with no maximum limit. Tax Saver FD come with a maximum limit of RS 1.5lakh per annum.

Why choose Fixed Deposit?

 “Do not save what is left after spending, but spend what is left after saving.”- Warren Buffet.    Fixed Deposit is most popular investment option in India. Following reason for why one should choose fixed deposit  :-

1.       Guaranteed return on investment.
2.       Flexible deposit tenure option
3.       Fixed deposit interest rate is higher than the interest on the savings account.
4.       Bank, Financial Institution provide loan against Fixed Deposit.
5.       Fixed Deposit can be withdrawal before maturity.
6.       Tax saver FD attract the tax benefit u/s 80C of the Income Tax Act.
7.       FD's are liquid. FD's holder will be charged a penalty, fixed deposit can be withdrawn as and when needed.

FIXED DEPOSITE INTEREST RATE BY TOP  BANKs IN INDIA

BANK	FD Rate of Interest (Regular customer)	FD Rate of Interest (senior citizens)	TENURE
SBI Bank	5.00% to 6.50%	5.50% to 7.00%	7 Days to 10 Years
ICICI Bank	4.00% to 7.30%	4.50% to 7.80%	7 Days to 10 Years
HDFC Bank	3.50% to 7.30%	4.00% to 7.80%	7 Days to 10 Years
PNB Bank	5.50% to 6.75%	6.00% to 7.25%	7 Days to 10 Years
Canara Bank	5.75% to 6.70%	6.25% to 7.20%	7 Days to 10 Years
Axis Bank	3.50% to 7.30%	4.00% to 7.80%	7 Days to 10 Years
Kotak Mahindra Bank	3.50% to 7.00%	4.00% to 7.50%	7 Days to 10 Years
Bank of Baroda	5.25% to 6.45%	5.75% to 6.95%	7 Days to 10 Years
IDFC Bank	4.00% to 8.00%	4.50% to 8.50%	7 Days to 10 Years
Bank of India	5.25% to 6.75%	5.75% to 8.25%	7 Days to 10 Years
United Bank Of India	4.50% to 6.25	4.00% to 7.00%	7 Days to 10 Years
UCO Bank of India	4.50% to 6.50%	4.75% to 7.00%	7 Days to 10 Years
Union Bank Of India	5.00% to 6.85%	5.50% to 7.35%	7 Days to 10 Years
Yes Bank	5.00% to 7.25%	5.50% to 7.75%	7 Days to 10 Years
Allahabad Bank	5.00% to 6.75%	5.00% to 6.75%	7 Days to 10 Years
Central Bank Of India	4.75% to 6.65%	4.75% to 6.65%	7 Days to 10 Years
RBL Bank	5.00% to 8.00%	5.50% to 8.50	7 Days to 10 Years

 

FIXED DEPOSITE INTEREST RATE BY TOP  NBFC ( Non –banking financial companies)  IN INDIA

Bank	FD Rate
Bajaj Finserv LTD.	8.00% to 8.60%
Mahindra Finance	8.30% to 9.00%
LIC Housing Finance	8.15% to 8.35%
PNB Housing Finance	8.30% to 8.45%
Sriram Transport Finance	8.25% To 9.25%

  

Eligible Criteria to open an FD Account :

The Following Groups and Individuals are eligible to open an FD-

            v  Individual

            v  Joint accounts for 2 or more individual

            v  Partnership Firm

            v  Trust

            v  Minor

            v  Limited Company

            v  HUF

            v  Association, club etc.

Document Required to open FD Account :

·         Aadhar Card

·         PAN card

·         Voter Id card

·         Driving Licence

·         Passport

·         Telephone Bill

·         Electricity Bill

What you should do?

Fixed deposit one of the popular investment option among investor as it is one of the safest way to invest money and get good return.  Fixed deposit is a good choice for people who have lump sum amount, which they don’t need to use at the time. You choose any investment option based on your financial goal. Mutual fund provide high return more than FD but Mutual funds are high risky. Your risk tolerance level depend on the investment decision. If you are a risk-averse investor and do not want equity exposure , then FD is for you.

       Don't be Selfish

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