The Role of Fixed Deposits in Your Retirement Portfolio

When it comes to investment in India while keeping retirement in plan, most working class is inclined towards putting their hard-earned money into a fixed deposit. Now, there is no doubt that the fixed deposit interest rate is quite lucrative in our country, which has definitely been able to pull many individuals towards it. 

Looking for the best high-interest savings account or fixed deposit? Consider accounts with attractive interest rates to grow your savings. Fixed deposits offer higher interest rates for a specific period. Compare rates, terms, and liquidity options to make an informed decision. Consult financial experts to optimize your savings strategy.

FDs are a popular investment option in India, particularly among conservative investors. This is because they offer safety, assured returns, higher rates of interest, tax benefits, and convenience of opening. 

What is a fixed deposit?

It is a financial instrument offered by banks and other financial institutions where a potential investor deposits a lump sum amount for a fixed duration, usually ranging from a few months to several years. 

Further, the deposit earns a fixed interest rate, which is already determined at the time of opening the FD.

The investor here chooses the tenure, and the interest rate offered by the bank totally depends on the tenure. Usually, the longer the tenure, the higher the rate of interest. 

When the tenure ends, the investor can withdraw the principal amount along with the interest earned on it. Moreover, some financial institutions also offer the option of reinvesting the maturity amount in another FD. 

What is fixed deposit interest rate?

As the name implies, it is the rate at which a bank or financial institution pays interest on the actual money deposited by an investor in an FD account. The rate of interest here is fixed at the time of opening the FD account and remains constant for the duration of the deposit term. 

Furthermore, it varies depending on various factors such as the deposit amount, investment duration, prevailing market conditions, and the policies of the financial institution offering the scheme.

What is the role of fixed deposits in your retirement portfolio?

FDs can play an essential role in a retirement portfolio as they offer quite a safe and sound income source. When you retire from your job, it is always important to have a backup. Therefore, it is essential to have a mix of investments that offer both incomes as well as growth potential. 

For those who don’t know, the prime advantage of investing in fd with the best fd rates in India is that they offer a constant rate of interest, which is not at all subject to fluctuations in the market. This means that retirees can depend on a steady stream of income from it, which can easily be used to cover regular expenses in retirement. 

Moreover, once you plan to invest in it, there is no need to worry at all, as managing this investment scheme is super easy. Once it is started, there is no need to actively manage the investment. The interest amount earned is simply credited to the investor’s account regularly, and the principal amount is returned when the investment tenure ends. 

How to invest in an FD?

Before investing in an FD, it is essential nowadays to use an FD calculator. In my personal experience, when I was planning to invest in an FD, I came across many organizations like ICICI, Groww, HDFC, etc. However, I did not find their service up to the mark. 

This was when one of my colleagues told me about the Bajaj Finserv application. Trust me, this platform is the best if you want to invest in the same.

  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