Reasons Why Fixed Deposit is a good investment in India?

A fixed deposit is the most common and safest investment option in India. Because Indian citizens prioritize the safety of their investment funds, fixed deposits have dominated the market as a low-risk investment option.

Furthermore, because corporate fixed deposits pay higher interest rates than banks, new-age investors are gravitating toward high-interest fixed deposit schemes from NBFCs in order to earn a substantial return on their investment.

A fixed deposit is a good investment for investors who want to earn consistent returns without exposing their funds to market risks.

A fixed deposit is only beneficial if it is booked for the long term. As a result, if you have a long-term goal, an FD (Fixed Deposit) is the best investment option in the current cash-strapped economy.


Few reasons why FD are the best investment option:

Sweep out feature:

This is the best option that banks provide to Savings Account customers. Enabling this option converts excess funds over a certain limit into a Fixed Deposit. This converts savings account funds into higher-yielding funds. When funds are required, the bank withdraws the amount from the Fixed Deposit, but the balance continues to earn higher interest rates. This facility has the potential to generate a significant amount of wealth for people who invest in Savings Accounts.

TDS limit:

TDS will not be levied on Fixed Deposit income unless it exceeds Rs.40,000. (Rs.50000 for senior citizens). It is also possible to submit Form 15G for non-senior citizens and Form 15H for senior citizens. The bank will not deduct TDS on Fixed Deposit income if this form is submitted. This places a larger sum in the hands of the person who makes the FD investment.

Investment period is flexible:

A Fixed Deposit can be opened with a bank for terms ranging from seven days to ten years. Fixed Deposit rates vary depending on the length of time the funds must be invested. You can, however, calculate the interest you will earn using the FD calculator, which will assist you in making an informed decision. Even for short-term deposits, FDs provide capital security.

Auto-renewal service:

Most banks will automatically renew your deposit if you provide standing instructions. This makes it an extremely convenient investment option to have. If you're wondering how an FD is superior, the convenience of an FD is unrivalled.

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