123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL >> Investing---Finance >> View Article

Difference Between Recurring Deposit And Fixed Deposit

By Author: Aishwarya Mahurkar
Total Articles: 291

For first time investors, there are a variety of investment options available for an individual to choose from. The safest options available are fixed deposits and recurring deposits. Though many believe both of these investments to be the same, they differ greatly. Some of the most common differences between Recurring deposit and fixed deposit that investors must be aware of are:

• Recurring deposit is a type of deposit in which the investor is required to deposit a fixed amount every month into their account.

• In the case of a fixed deposit, the investor is only required to deposit an amount one time. At the end of the tenure the investor can collect the amount they deposited along with the interest.

• Recurring deposit is the ideal option for individuals who wish to build their savings.

• Fixed deposit is however used as an investment option for individuals with surplus savings.

• A recurring deposit requires individuals to deposit a fixed amount each month. Not being able to do so will force the financial institution to reduce the interest amount being offered.

• A fixed deposit only requires one deposit to be made. At the end of the duration of the deposit, the individual gets their deposited amount along with the interest.

• The minimum period of such a deposit is six months while the maximum period is ten years.

• In the case of fixed deposits, the duration period is between six months to ten years. However, certain deposits also allow individuals to deposit their money for unique durations such as 190, 290 and 390 days.

Both types of deposits are low risk investment options. However, a fixed deposit does offer a higher interest rate at the end of the duration. The reason being that the interest is compounded on the entire amount deposited each month. In the case of recurring deposits, the interest is usually compounded on a quarterly basis. Since the individual has to deposit a fixed amount each month, this offers a lower interest amount at the end of the duration of the deposit.

If you are looking for a type of deposit to help build your savings, recurring deposit is the ideal choice. The monthly deposit requirement ensures that the individual is able to easily build their savings in the duration set. Fixed deposits however are a safe investment option. One can use this type of a deposit to invest their surplus savings and get interest on the same. One must always research the different types of deposits to ensure that they choose the one ideal for their needs.

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 deposits & fixed deposits and how to make the right investment choice.

Total Views: 107Word Count: 466See All articles From Author

Investing / Finance Articles

1. Ways2capital : Commodity Market Of India
Author: Mahendra Rajput

2. Easy Ways To Minimize Trading Risk
Author: Anthony Gutridge

3. Ways2capital:- Demonetization: Stock Market Cheered!!!
Author: Mahendra Rajput

4. Check Your Car Loan Requiremets Right From The Comfort Of Your Smartphone
Author: Neha Sharma

5. Calculate Your Home Loan In Mere Seconds With The Loan App
Author: Neha Sharma

6. Looking For A Personal Loan? Download The Loan App Now
Author: Neha Sharma

7. Take A Look At How Loan Apps Work To Your Advantage!
Author: Neha Sharma

8. Calculate Your Loan Eligibility Through Your Smartphone!
Author: Neha Sharma

9. Your Smartphone Is The Key To Your Convenient Emi Repayment
Author: Neha Sharma

10. Online Loan Application: Enjoy A Stress Free Loan Application Through Your Smartphone
Author: Neha Sharma

11. Now Easily Track Your Loan Application Status Through Your Smartphone
Author: Neha Sharma

12. Did You Know That Your Smartphone Is The Best Way To Apply For A Loan?
Author: Neha Sharma

13. How Can Your Loan Application Process Be Made Easy?
Author: Neha Sharma

14. Banking Apps: Keeping Your Finances Safe
Author: Neha Sharma

15. Check Out These Features Of The Internet Banking App And How It Can Help You
Author: Neha Sharma

Login To Account
Login Email:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: