Fixed deposit is one of the best investment types offered by financial institutions. Different financial institutions have different fixed deposit interest rates and schemes.
Sounds intriguing? Here are all types of FDs:
Types of fixed deposit
Here are some types for you to gain knowledge and invest in the best;
- Standard Fixed Deposits
- Tax-Saving Fixed Deposits
- Cumulative Fixed Deposits
- Non-Cumulative Fixed Deposits
- Senior Citizen Fixed Deposits
- Flexi Fixed Deposits
Why is a fixed deposit worth an investment?
Fixed deposits offer secure and risk-free investments, and there are no restrictions on the investment amount. However, for senior citizens, there are chances of a higher interest rate on their fixed deposit account.
Interestingly there are also some exceptions in tax under section 80C where you have an option to save some extra for yourself. So here are some exciting benefits of why investing in a fixed deposit is worthwhile;
You get the highest interest rate than any other investing instrument
You get a comfortable and beneficial investment experience with maximum returns. Also, there are other benefits apart from the skyrocketing FD rates. So compare and Calculate FD Interest before investing to get maximum returns.
You can begin investing with a minimum amount
Don’t take your time to save ahead of time to invest. A small sum is enough to kickstart to have a maximum return as the days progress.
Easily accessible for everyone
Any citizen above 18 years from different societies, partnership firms, group companies, sole proprietorships, clubs, associations, family trusts, etc., can invest in a Fixed Deposit Account.
Flexible tenors to attain life goals
Investors can choose suitable tenors between 7 days to 20 years, suiting their financial goals. This is applicable for both short and long-term goals. So you just need to invest and reap wealth in a few minutes.
Eligibility criteria for a fixed deposit
- Must be a resident of India.
- Must qualify factors age (either minor or senior citizen), minimum income, etc.
Documents required for a fixed deposit account
Here are some necessary documents you must carry while applying for a fixed deposit;
- Identity proof- Some include voter ID cards, PAN cards, Aadhaar cards, driving licenses, photo ration cards, and senior citizen ID cards.
- Address proof- Some include gas, electricity, water, or telephone bills, bank statements, post-office issued ID cards or certificates, etc.
However, Aadhar and Pan card are enough to create an online FD account.
How to choose the perfect fixed deposit?
Check the following factors before choosing the fixed deposit;
- Compare and Calculate FD Interest offered by different banks.
- Check the lender’s credibility and ensure the safety of the FD you’re availing.
- Select whether you want a cumulative or non-cumulative fixed deposit.
- Finally, shortlist the bank with the best customer service with a minimal opening process for opening an FD.
Tax benefits for a fixed deposit
- Tax deduction up to Rs 50000 on the earned interest amount for senior citizens.
- The interest earned is liable for a TDS deduction. However, you’re exempted from paying tax if you fill out Form 15G.
- If your account is classified as a minor, you get a nomination feature with the fixed deposit investment.
How to open a fixed deposit?
Online opening procedure
- Users can open an FD account without even having a savings account in the bank.
- Use the net banking facility, fill out the form and submit the application to unlock your account instantly.
- If you have a mobile app for your bank, you can use that to open an account.
- If you have any issues while opening, the customer care service is always reachable to resolve your queries and issues.
Offline opening procedure
- Visit your nearest bank branch if you wish to open an FD account.
- You’ll be asked to fill out a form and hand over essential documents.
- Finally, you must deposit the initial amount and receive the FD receipt.
Therefore it’s time that you open a Fixed Deposit Account for investment to avail maximum benefits and tax exemptions and start building wealth for a prosperous future!