Fixed Deposits (FDs) are a popular and secure investment option where you deposit a lump sum amount for a fixed tenure at a predetermined interest rate.
FDs provide guaranteed returns and are ideal for conservative investors looking for steady income without exposure to market volatility.
With flexible tenures ranging from a few months to several years, investors can choose an FD plan that fits their financial goals.
Interest on Fixed Deposits can be compounded quarterly, monthly, or paid out periodically depending on the scheme. The principal is returned at maturity along with the accumulated interest.
FDs are offered by banks and financial institutions, and most are covered under deposit insurance schemes, providing additional safety.
They help in capital preservation while earning better returns than regular savings accounts, making them a preferred choice for risk-averse investors.
Advantages of Fixed Deposits:
Regular Fixed Deposits
Standard FDs with fixed tenure and interest payout options, suitable for most investors.
Tax Saving Fixed Deposits
FDs with a lock-in period of 5 years, offering tax deductions under Section 80C of the Income Tax Act.
Senior Citizen Fixed Deposits
Special FDs offering higher interest rates for senior citizens to provide better income security.
Recurring Fixed Deposits
Allows investors to deposit a fixed amount every month for a specified tenure, useful for disciplined savings.