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3 Factors To Check Before Selecting A Fixed Deposit

By Author: Aishwarya Mahurkar
Total Articles: 291

Fixed deposits are an ancient financial product. But, they remain relevant in today’s age too since people do need low-risk financial products. Fixed deposit schemes are a great way to diversify and support high-risk investments. So, smart investors consider them seriously and invest carefully. In today’s competitive age, several banks and companies offer highly competitive interest rates. So, selection is not obvious. So, here are three factors you should consider before selecting a fixed deposit scheme.


Type of fixed deposit:


Main types of fixed deposit accounts in India are as follows:

• Standard FD: These are readily available in several banks.

• Tax saving FD: These products are availed for tax rebate only. However, their lock-in period is significantly higher than other financial products for tax exemption. So, the demand for these products is stumbling down.


• Company FD: Several companies offer these products. The risk is slightly higher and so is the rate of interest. But, their credit rating allows investors to select a right investment. With due consideration to all these criteria, personal finance advisors recommend DHFL Aashray deposit plus scheme. This company has a high credit rating, great liquidity and good rate of interest.


Fixed deposit interest rate:


This is a primary selection criterion for most investors. They want a highest yield possible from these secure products. If this presumption is right, most investors should opt for company fixed deposits. They have the highest rate of interest. However, it is essential to take their Crisil and Brickwork credit rating into account for making a safe choice.


Interest payments:


People want to enjoy a return on investment in different patterns. Some want a cumulating interest at the end of the FD tenure. Some prefer to receive a monthly, quarterly or annual return on FDs. It is a personal choice. Most organizations offer different products to facilitate these requirements. So, you can always utilise this interest as per your convenience. You can reinvest or spend it. You will have this while selecting the fixed deposit account.


Several investors will insist on considering other factors i.e. overdraft or liquidity. But, these factors are not always applicable to all investors. Few need to consider it if they deem it necessary. But the best part of these different financial products is the right combination of safety and earnings. This is ideal for most middle-class families, who need to make long-term investments for their families. So, select the FD of your choice and invest in your future today.

Author Bio :

An experienced writer on finance topics, the author articulates of investment choices such as fixed deposit products in India & recurring deposit schemes. She writes about a variety of topics including the benefits of recurring & fixed deposit and how to make the right investment choice.

Total Views: 146Word Count: 459See All articles From Author

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