Many people prefer to invest their money in risk free schemes instead of investing in any risky schemes.
Many people prefer to invest their money in risk free schemes instead of investing in any riskier schemes. Even today there is a large middle class in the country who likes to invest in bank FDs. There are FD schemes from 7 days to 10 years in different banks.
In the last few months, many banks like SBI, Axis Bank, HDFC Bank, Bank of Baroda etc. have increased the rate of interest of their FDs. If you are also thinking of investing in bank’s FD i.e. fixed deposit scheme, then it is very important to keep some things in mind.
If you break the FD prematurely in the event of an emergency, you will suffer the least loss. Know about these tips.
FD laddering is a good option. If you are planning to do a total FD of Rs 5 lakh, then you should do five FDs of Rs 1 lakh each for different periods. With this, you will not have trouble breaking the money in case of emergency.
Due to this, if you have a sudden need of Rs 2 lakh before the deadline, then you will break only two FDs and you will get the benefit of full interest on the remaining three FDs. Along with this, you will also get different types of additional benefits in investing money in different banks.
If you make a simultaneous FD of a higher amount like Rs 10 lakh, then you will get tax deducted according to the 30 percent tax slab. With this you will not get much profit on interest. Therefore, even if you get a lower interest rate in a small amount, you will have to pay less tax and in case of emergency, there will be less loss.
If you are planning for FD in the bank for a long period, then in such a situation you can get more benefits by investing in special schemes of the bank like 444 days, 659 days, 888 days etc. In this many times you get extra benefits like higher interest rate.
If you want to get higher returns on FD then you can do FD in small finance banks instead of big banks. Most of the small finance banks offer higher interest rates than the big banks. Along with this, customers also get the facility of additional insurance cover.
