Securing Future, by securing a surplus.
Investments can get complicated for some. An income that is hassle-free, with less risk soothes those who have never invested before and are therefore sceptical about taking those decisions. A Fixed deposit, in that case, is a type of fixed income plan investment that boosts savings to actively meet short and long-term goals. It is simple and gives returns worth investing.
Some of the benefits of fixed deposits are as follows
The only pre-condition is that in case you end up redeeming your amount before the stipulated timeframe, the bank is liable to pay you your principal amount only. You will be expected to forego the returns because the term is not complete. In other words, if you have invested Rs.50,000 and are liable to receive Rs.70,000 by the end of the year, but you end up redeeming the amount before that period, the bank is liable to return the Rs.50,000 to you and let go of the Rs.20,000.
Being fully aware is the first step while taking any financial decision. In that case, a fixed deposit account, much like a savings account (but with better return), ensures that you get back everything you put in and more.
Best Investment Plans for Fixed Income
Here’s out top pick of the best investment plans for fixed income for the year 2021.
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Frequenty Asked Questions
It is an investment where you have to deposit a certain amount with a bank, Non-Banking Financial Institution (NBFC), or any other money lending entity. This amount is deposited for a fixed period of time and a fixed rate of interest. You receive interest yearly, monthly, or quarterly depending upon the fixed tenure alongside getting repayment of the principal amount.
You just need to be a resident individual. If you are, you are surely eligible to invest in an FD thereby, gaining the added benefits and schemes. You can avail an FD, irrespective of your age. Be it a public or private limited company, partnership firm or society, Hindu Undivided Family (HUF), everyone is eligible to invest in an FD.
Majorly, there are two types of FDs namely Cumulative and Non-cumulative.
Cumulative FD – Here the interest is calculated annually. You receive you’re your principal and interest amount at the time of maturity. In addition, the earned interest is taxable depending upon the tax slab in which you fall.Non-cumulative FD – Here you gain interest yearly, half-yearly, monthly, or quarterly as per your choice.
Many banks and financial institutions offer interest rates, which tend to be slightly higher. This special interest rate also helps in a tax deduction. These interest rates may vary from bank-to-bank. Also, most of the banks offer theses rates when you apply for an FD with a co-applicant who is not a senior citizen.
You have the privilege to ask for a loan against your deposited amount, without being penalized for breaking an FD. As such, you receive the money for the emergency and also interest at the same time. The loan amount can vary from bank-to-bank. However, the interest on the loan will be lesser than the one that is paid on your FD.
This is also known as a savings-cum-fixed deposit. This facility aligns your current/savings account to your FD account with ease. Depending upon your principal amount and current deposits, it gives you the liberty to analyse the minimum as well as the maximum balance for your savings account.