Tuesday, September 26, 2023

Safety Measures to Consider When Investing in Fixed Deposits

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Picukiusa is the Chief Business Development Officer at Picukiusa, a Magento design and development company headquartered in Redwood City, California. He is a Member of the Magento Association and an Adobe Sales Accredited Magento Commerce professional. Jan is responsible for developing and leading the sales and digital marketing strategies of the company. He is passionate about ecommerce and Magento in particular — throughout the years his articles have been featured on Retail Dive, Hacker Noon, Chief Marketer, Mobile Marketer, TMCnet, and many others.

One of the most popular investment options in the current times is the fixed deposit for individuals who want to earn a fixed return on their savings with low risk. However, as a beginner, it is essential to calculate fd interest before investing by using specific tools.

Fixed deposits are considered low-risk investments in India as they are insured by the government up to a certain amount of money. This means the principal amount here remains safe even if the financial institution/bank goes bankrupt. 

What is a fixed deposit?

It is a type of investment account offered by banks and other financial institutions where a potential investor can quickly deposit a lump sum amount of money for a fixed time. Further, the amount deposited earns a fixed rate of interest that is also predetermined when opening the FD account. 

The rate of interest for FDs is generally higher than that offered on savings accounts, and it is fixed for the entire deposit duration. However, it usually varies depending on certain factors such as the amount deposited, the tenure, and the policies of the financial institution offering the fixed deposit. 

When this investment matures, the investor can easily withdraw the total amount along with the interest earned. However, premature withdrawals are usually subject to penalties, and the rate of interest may be reduced as well. 

What are the Safety Measures to Consider When Investing in Fixed Deposits? 

  • Choose a reputable institution

Ensure you invest your money in a well-established financial institution with a good track record of delivering promised returns. For example, Bajaj Finserv is one of the best applications to use for this purpose. 

  • Check the Rate of Interest

Before investing your hard-earned money, it is very crucial to compare the interest rates offered by various financial institutions. It is then essential to choose the one that provides the best rate as per your suitability. 

(Note: If you think about “how to calculate fd interest rate?” go for a fd calculator.)

  • Verify FD scheme details

Check the terms and conditions of the FD investment scheme which you are planning to avail. This includes the minimum and maximum deposit amounts, the maturity period as well as the rate of interest. 

  • Understand the fine/penalties

Be well aware of the fine/penalties for premature withdrawal or breaking the FD before its maturity date. Ensure that the financial institution you choose has a fair penalty policy. 

  • Keep documents safe and secure

Make sure that the documents related to your FD investment are always safe and secure. These include receipts, statements as well as the Fixed Deposit Certificate. 

How to invest in a fixed deposit?

Nowadays, investing in fixed deposits is as easy as ordering food or groceries from your internet-enabled smartphone. You need just the right app. Around a month back, when I was planning to invest in the same, one of my colleagues told me about the Bajaj Finserv application. Believe me, it is super easy and convenient to use. 

  1. Download the app from Play Store/App Store
  2. Sign up by entering your mobile number
  3. On the home page, you’ll see the Investment Bazaar section
  4. Tap on Fixed Deposit
  5. Proceed further as per your suitability/requirements

(Tip: Use a fixed deposit calculator before investing.)

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