Benefits of Fixed Deposits: A Reliable Investment Avenue
Growing Savings through Fixed Deposits
Fixed deposits are a popular investment option, especially in India, as they provide a secure way to grow one's savings while earning a fixed rate of interest. Fixed deposits offer numerous advantages over other investment options, which makes them a popular choice among conservative investors.
Investors can make fixed deposits with Federal Bank starting with a minimum amount of ₹1,000, and there are no limits for the maximum amount one can put in these fixed deposits.
Advantages of Fixed Deposits
1. Fixed Rate of Interest: One of the primary benefits of investing in fixed deposits is that they offer a fixed rate of interest, which is higher than regular savings accounts. The interest rate on fixed deposits is determined at the time of investment, and it remains the same throughout the term of the deposit. This means that investors can accurately calculate their returns and plan their finances accordingly.
After opting for a fixed deposit with Federal Bank, investors can choose between different interest payment frequencies, which can either be monthly, quarterly, half-yearly or yearly.
2. Safety and Reliability: Another advantage of fixed deposits is their safety and reliability. Fixed deposits are generally considered to be a low-risk investment option. In case of any defaults, the deposits are insured up to a certain amount by the Deposit Insurance and Credit Guarantee Corporation (DICGC).
Federal Bank deposits come with an automatic renewal facility and investors can also avail of a loan against these deposits. The loan amount can be up to 90% of the fixed deposit.
3. Flexible Investment Period: Fixed deposits also offer a flexible investment period, ranging from a few months to several years. The fixed deposits offered by Federal Bank have a minimum deposit period of 7 days to a maximum deposit period of 10 years. This flexibility allows investors to choose the term that best suits their financial goals and requirements.
4. Convenience: Investing in fixed deposits is also hassle-free and convenient, allowing investors to make fixed deposits both through online and offline means. Investors can make use of Federal Bank's online banking platform or their mobile banking application FedMobile to track their investments, view their account statements and renew their deposits with just a few clicks.
5. Liquidity- Furthermore, fixed deposits are highly liquid and can be easily converted into cash in case of emergencies. Unlike some other investments, there is no lock-in period for fixed deposits, and investors can withdraw their funds at any time, although a penalty may be imposed for premature withdrawals.
In conclusion, fixed deposits offer several benefits that make them a popular investment option. They provide a secure and reliable way to grow one's savings while earning a fixed rate of interest. They are also hassle-free, flexible, and highly liquid, making them a suitable investment avenue for conservative investors.
Investors can visit Federal Bank's website to further explore fixed deposit schemes and other available options for investments.