In order to build wealth, there is only one simple rule – Save money. And when you do so, so tend to develop excellent financial practices and increase cash reserves. One of the most trending investment options to earn a relatively good amount is a Fixed Deposit. This is because Fixed Deposit Interest Rate
It is considered a valuable investment through which you can save your hard-earned money securely and get assured returns. To start, you need a lump sum of money that you can put away for some time.
What is a Fixed Deposit?
Fixed deposit or FD is a financial provision offered by banks where one can deposit a lump sum amount and yield a higher interest rate than a savings account. Moreover, it is the perfect investment scheme for individuals who do not want any risk with their investment, as market fluctuations do not impact the invested amount. So basically, when it comes to FD, you invest for a fixed interest rate and a fixed period.
What are the 5 best ways to Choose the Right Fixed Deposit?
1. Fixed Deposit Calculator
One of the best to choose the right FD for you is to experiment first. This is where such a calculator comes into play. The FD calculator I use (in the Bajaj Finserv app) is very to use and helps to know what’s the best.
2. Lender’s credibility
A fixed deposit is a risk-free investment, but it’s always good to check the bank’s credibility where you wish to invest your money. Like in my case, I was planning to go with Bajaj Finserv, so there were no second thoughts, as it is one of the most trustworthy organizations regarding investments and digital payments.
3. Interest Rate
Ensure that the financial institution you opt for offers a high-interest rate on your FD account. It is a well-known fact that a Fixed Deposit Interest Rate differs from bank to bank, and longer tenures often attract higher interest rates.
4. Premature withdrawal
There might be times when you’ll be in need of emergency funds. Unlike other investments, where this is a fixed lock-in period, FDs are flexible. But remember, the banks charge a penalty if you opt for early withdrawal.
Even though FDs are flexible, choosing the right tenure is essential as it is directly linked to the interest you can earn. So short-term and long-term goals can be achieved by selecting an appropriate tenure for your deposit.
Here is a step-by-step guide on how to use a fd calculator-
- Download the Bajaj Finserv app from the App Store (iPhone) or Play Store (Android).
- Sign up after entering your details
- On the home page, click on three bars on the top right.
- Choose the ‘Try our Calculators’ option.
- Go to ‘Deposits Calculators’ and choose ‘Fixed Deposit Interest Calculator.
- Fill in the required details and experiment as per your requirement.
In the current era, for a better and more stable financial life, it is essential to save money. As recently only I got my first job, investing some of my money was always on my mind. So, as Bajaj Finserv has revised its rates from 7.85% to 7.95% recently, I’ll invest only with them but after properly experimenting with the Fixed Deposit Calculator.
(This is not a promotional write-up. Just sharing my personal experience for better understanding.)