Fixed Deposits Are Safe Investment Option With Decent Returns
Fixed deposits are indeed an ideal as well as safe investment option due to higher rates of interest offered by banks as compared to other money saving options.
These deposits are limited to a fixed term and after maturity you can withdraw your amount with added interest. Minimum time period for investment is one month, but it is more beneficial to opt for Fixed Deposits [ FDs ] with longer duration. Rates of interest offered for such FDs are comparatively higher than those of short-term deposits. The interest rates may start from 3% – 10% . It depends on the duration, bank, amount, etc.
Another advantage with Fixed Deposits is, you can get tax benefits for the amount you invested, if you invest for more than 5 years.
It is also suggested to consider all aspects carefully before investing in FDs as you have to give up your deposited amount for a specified time and in case you withdraw that amount before its maturity, certain amount of penalty can be taken from you.