Typically regarded as the safest investment option, Fixed Deposits Retain their charm among
investors who do not want to take many risks. Various banks and non-banking financial
companies offer FDs. When you open one, you can invest a fixed sum for a specific term and
earn interest at a predetermined interest rate at the start of the FD.When the FD term gets
done, you usually receive the amount you invested and the interest you earned on it.
Today, you can easily open an FD Account online using a Banking app or other Online
Banking platforms.Such Term Deposits offer various benefits. However, if you are clueless
about them, the following are a few reasons to consider opening one:
Offers assured returns
An FD is not influenced by volatility in the market. Hence, the interest rates offered do not
change. Instead, it stays the same as decided during the start of your deposit. As a result, the
returns on your Fixed Deposit are usually assured. This lets you plan your financial goals
easily.
Apply for Loans
Some banks also let you avail yourself of a Loan against an FD. While the Loan amount may
vary across banks, it lets you access funds instantly without disturbing your deposit.
Requires one-time effort
Today, you can easily open an FD online from anywhere and anytime. Once done, you need
to track the market to determine how your FD performs. This makes it easy for somebody
new to the world of savings and investment to open an FD.
Ensures safety of capital
When you open an FD Account, you need not think about capital erosion. Instead, the money
you deposit remains with the bank. The bank then offers your interest on time. Additionally,
once your FD matures, you can get back the entire investment amount. Hence, you do not
lose any money from your investment. The DICGC insures your deposit from up to Rs. 5
lakh.
Ideal for short-term goals
You can opt for an FD to fulfil your short-term financial goals. This is because such a deposit
protects your capital. It also actively earns fixed FD interest rates decided at the start of the
deposit. This way, it helps you pay for your short-term dreams, like a vacation and buying a
car.
Choose from flexible tenures
When you open a Fixed Deposit Account, your bank usually lets you choose from tenures
between seven days and 10 years, depending on your investment goals.
Conclusion
FDs are the most reliable financial instruments, offering various advantages. However, before
you open one, ensure you research well and compare the interest rates to match your needs.