All of us work hard to live a happy and contented life, don’t we? Some of us are lucky enough to earn more than what we require i.e the money that gets credited into the salary account isn’t made use of entirely. In this regard, it becomes very important to invest the extra money that’s lying idle into something useful.
If you’re wondering what’s wrong with letting the money stay as it is in the account, then you might have to change your opinion. That’s because even though the present may seem all rosy, there’s no surety that the future might also remain the same.
In simpler words, when the money you hold can earn you something extra it’s only wise to exploit it to the maximum extent.
As much it is important is the zeal, the avenue of investment needs to be equally safe. That’s where the option of fixed deposits steps in. There might be other alluring options fetching more interest like mutual funds and real estate but nothing can beat the conventional fixed deposit.
Fixed deposits are offered by both banks and NBFCs with the latter gaining more popularity in recent times. The option of receiving handsome returns at regular intervals is arguably the most attractive feature of fixed deposit investments.
Benefits of Fixed Deposit
Let us now look into some of the benefits of investing in a fixed deposit to make you understand the concept better.
Increases Savings: Withdrawal of fixed deposits before the completion of the tenure usually invites penalty. This feature will automatically lead to increase in savings as you as an investor will not be tempted to make use of that money unnecessarily.
Rate of Return: The fixed deposit interest rates vary from one institution to another. But the good news is, fixed deposits give way more returns than any other avenue of investment. Opt for the one that promises bigger rate interest than the rest.
Bajaj Finserv, a leading NBFC in India, offers interest rate as high as 8.25%.
Guaranteed Returns: As mentioned before, safety is the primary concern when it comes to investing a huge sum of money into something. Although— some other means might fetch a lot more money than FDs— you have the danger of losing the entire sum if the market becomes vulnerable or if the country is encountered with an economic crisis. Fixed deposits score big time in assuring guaranteed returns on your investment without making any sort of false promises on it.
Tax-saving: Who wouldn’t love the idea of saving tax while earning some extra money? All of us do. The question of interest earned on fixed deposit taxable or not, need not arise in your mind.
According to the section 80C of the Income Tax Act, fixed deposits with a maximum limit of Rs 100000 upto a period of 5 years is eligible for tax deductions.
Flexibility: If you’re wondering about the frequency of interest on the deposits made, then you can rest assured as there are multiple payment options available. NBFC offers to pay interest on a monthly, quarterly, half-yearly, annual basis in case you opt non-cumulative payout option. You thereby, have the liberty to choose the payment option that suits you the most.
A good investment always holds your back at the time of distress, no second thoughts on that. Go ahead and opt for a FD programme from a reputed NBFC and secure your future in a wise manner.