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Why Timing Your Fixed Deposit Rates Alongside Festive Seasons Is A Must?

By Author: Mayur Sheitty
Total Articles: 104

When it comes to investing one’s funds in a fixed deposit, timing is one factor that needs to be considered. By how can this timing affect one’s investment? For one, it determines the fixed deposit rates, which will last throughout the tenure. For a short-term goal, this may not be an imperative. However, for long-term deposits of 10 years, this is a crucial decision that must be taken into consideration, as once the rates are fixed, it cannot change.

But when is the right time to invest in these fixed deposits? In reality, there is no right time. However, if one want to invest, the right time is during the festive time. Given below are a few reasons as to why one should invest in this termed deposit during festive seasons:

Lenders offer best rates: Festive times, especially in India see a lot of financial activity. No doubt, there will be plenty of expenditures. But since more and more individuals are becoming financial conscious and savvy, it is not only the expenditures that are increasing but also the investment options. In order to attract potential investors, lenders offer attractive rates on their products, including fixed deposit rates. And as mentioned earlier, since these rates are fixed throughout the duration of the deposit tenure, one can enjoy these benefits till the end. To get the best rates in this way, one would need to compare the different rates to know how one can benefit from the available options.

Invest income bonus for better returns: While the festive season may inspire lenders to offer good FD rates for investment. However, this also depends on the investment amount that one will be investing. While one may have funds set aside to invest during this time, one can also add to the existing funds, by including the bonuses that are normally received during festive seasons. In this way, one can enjoy the benefits of higher return on investments.

Compounding interest benefits: When it comes to opting the right FD rates for one’s investments, the type of interest rate is also one factor. One can either opt for a simple interest rate or a compound interest rate. While the simple interest rate will offer a return on investment based on a fixed interest rate and the principal amount, the compounding interest included the interest that is added to the principal amount. While this may seem like a small benefit, in the long run, especially for a long tenure of 10 years, one can get at most triple the amount one had initially invested.

While these are some of the initial reasons, there are plenty more which one should consider. However, before one makes the decision to invest, one should always check the investment rates to confirm if one is getting the best of the deal.

Author Bio :

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

Total Views: 55Word Count: 516See All articles From Author

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