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Bank fixed deposits still remain one of the most preferred investment options for Indians. Here, we look at how FDs work and what are the pros and cons of the same.
Fixed deposit is one of the most popular investment tools in India as they offer guaranteed returns and are risk-free. Investors can park their money in fixed deposits as per their financial needs as fixed deposits offer investors the flexibility of choosing the tenure of investment. Such deposits offer the highest flexibility to the investor in terms of the investment amount, tenure of investment and interest payouts. Various banks and other financial institutions in India offer investment schemes at competitive fixed deposit interest rates.
Fixed deposit is a traditional investment tool preferred by investors who are looking for a secure investment option and regular income flow. As the name suggests, fixed deposit offers fixed returns on the investments. The nature of this investment is very secure and they earn interest as per the interest rate they carry. Following are certain pre-determined parameters on which they work:
The bank deposits are one of the most sought investment tools because of its unique feature. Following are the distinct features offered by bank deposit that help you in saving money:
Investing in fixed deposit is a good investment decision but it is best to first understand and determine the personal financial aspirations and then make investments. The average amount and lock-in period can be determined after assessing personal financial needs. The investors can decide the amount of investment as per their investment portfolio and financial needs. Lastly, we recommend all investors to carry extensive market research and then invest.
Recommended Read: Benefits of Fixed Deposits Offered by Various Banks in India