Fixed deposits are a good method to invest and save money today while also saving for the future. After the FD matures, the depositor receives the principal amount as well as the interest received. There are certain benefits that come with certain Fixed Deposit plans including no penalty for early withdrawal, liquid FD, one-step FD creation, competitive interest rate, and more.
Banks offer many forms of fixed deposits to their customers, allowing them to invest in a way that best meets their needs and budget. The features, advantages, limits, and flexibility in terms of mature or premature withdrawals distinguish the various forms of fixed deposits.
Cumulative Fixed Deposit
- The interest is available at the end of the term.
- Interval-based interest does not apply to users.
- High rates of interest.
- People who do not want to pay interest on a regular basis might consider this option.
- The duration of an FD might be anywhere between one and five years.
Non-Cumulative Fixed Deposit
- Interest is provided on a regular basis.
- The tenure of an FD varies from one to five years.
- If the interest is paid on a regular basis, the amount payable at maturity will be reduced.
- Suitable for those who require a steady source of income in the form of interest.
Bank Deposit
- Banks provide this service to consumers who have a savings account.
- Interest rates are lower than those supplied by non-banking financial institutions.
Company Deposit
- NBFCs provide it with high-interest rates.
- For companies that have a good credit history.
Senior Citizen Fixed Deposit
- For those above the age of 60.
- When compared to other FDs, it offers a higher rate of interest.
- Tenures that are flexible.
NRI Fixed Deposit
- NRIs, OCIs, and PIOs having NRO accounts are eligible.
- In comparison to ordinary savings accounts, this account pays a higher rate of interest.
- Fixed-term contract
- NEFT/RTGS from the NRO bank account is the preferred method of payment.
Tax Saving Fixed Deposit
- A large number of banks offer it.
- Annual tax exemption of up to Rs. 1.5 lakh
- There is a 5-year lock-in period before which the money cannot be withdrawn.
- Deposit of a one-time lump sum amount
Standard Fixed Deposit
- Fixed tenures.
- The interest rate is predetermined.
- Tenure ranges from seven days to ten years.
- When compared to a savings account, higher interest rates are available.
It is important for you to look at the various features that every different kind of Fixed Deposit comes with. The various types of Fixed Deposit plans are designed in a way that meets the requirements of people across ages and professions, who are at various stages of their lives. Once you chalk out your requirements, it will be easier to choose an FD that would be best suited for you.
