Know About Fixed Deposit (FD)

Fixed Deposits (FDs) are a popular investment choice among individuals seeking stability and assured returns. Investing a significant sum like ₹20 Lakhs in an FD can provide a steady source of income. Here’s a look at how to calculate the monthly interest earned on such an investment using an FD interest calculator, ensuring you make the right financial decisions. Using an FD Interest Calculator To determine the monthly interest earned on a ₹20 Lakh FD, one can utilise a monthly FD interest calculator available on various financial websites and platforms. These calculators require inputs such as the principal amount (₹20 Lakhs), the interest rate offered by the bank or NBFC, and the tenor of the FD. Simple Interest Calculation for ₹20 Lakhs Fixed Deposit Let's consider an example where the issuer offers an interest rate of 6.5% per annum on a ₹20 Lakh FD for a tenor of 1 year. We can determine the monthly interest earned as follows: Principal Amount (P) = ₹20,00,000 Rate of Intere...

In the pursuit of financial stability and growth, setting achievable targets is crucial. Whether you're saving for a down payment on a home, funding your child's education, or building a retirement fund, having a roadmap can make all the difference. However, navigating through various investment options and interest rates can be daunting. This is where an FD calculator can be beneficial. It is a powerful tool to help you reach your financial targets with precision and confidence. Clarity and Goal Setting  One of the primary benefits of using an FD calculator is the clarity it provides in goal setting. By adding your desired target amount and preferred investment tenor, the calculator can instantly reveal the principal investment required to achieve your objective. This level of transparency helps you make informed decisions and adjust your savings strategy accordingly. Flexibility Every individual's financial situation is unique, necessitating tailored investment strategi...

Financial markets are inherently volatile, experiencing periods of significant upswings and downswings. This volatility can be nerve-wracking for investors, particularly those seeking stability and predictable returns. Fixed deposits (FDs) emerge as a compelling option in such scenarios, offering a haven for your savings amidst market turbulence. Here are 7 ways FDs can protect your savings from market volatility: 1. Guaranteed Returns Unlike market-linked investments like stocks and mutual funds, FDs offer guaranteed returns. An interest rate is decided on at the time of deposit, ensuring a predetermined amount of interest income on maturity. This predictability eliminates the anxiety associated with market fluctuations and protects your principal investment from potential losses. 2. Minimal Risk of Capital Erosion Since FDs are not directly linked to the stock market, your principal amount remains relatively secure throughout the deposit tenor. This is particularly beneficial for ris...

For individuals seeking to safeguard and grow their savings, navigating through investment options can seem complex. Fixed Deposits (FDs) have traditionally been a trusted option, offering predictability and guaranteed returns. However, liquid funds can be a viable alternative, with greater flexibility and the potential for higher returns. Understanding the key distinctions between these two investment options is crucial for making better financial decisions. Fixed Deposits Fixed deposits , offered by banks and Non-banking Financial Institutions (NBFCs), have been an important aspect of savings strategies for many years. Their key features are: Guaranteed Returns: FDs lock in an interest rate at the time of investment, providing certainty and predictability. Investors know precisely how much their principal amount will grow over the chosen tenor. This feature is particularly attractive for risk-averse individuals or those saving for specific short-term goals, such as a down payment or ...

Fixed Deposits (FDs) play a crucial role in a diversified investment portfolio. They offer a safe and reliable option for investors seeking stability. Unlike high-risk investments, FDs provide guaranteed returns over a fixed period. This makes them a good choice for risk-averse individuals or those looking to temporarily invest idle funds.  By including fixed deposits in your investment strategy, you can ensure a portion of your savings grows steadily, helping to balance out the volatility of higher-risk assets. This blend of security and growth potential makes them a valuable component in achieving a well-rounded and resilient investment portfolio. Importance of Fixed Deposits FDs offered by banks and NBFCs emerge as essential components of investment diversification. Here's why: Low-risk Investment: FDs are considered low-risk investments. You deposit a fixed amount of money for a predetermined tenor, and at maturity, you receive your principal amount along with the accrued inte...

Financial planning in India requires balancing investment growth with tax efficiency. In this regard, tax-saving Fixed Deposits (FDs) offer a compelling solution, merging the stability and predictability of fixed returns with notable tax advantages. Here’s an overview of tax-saving FDs, covering their main features and potential drawbacks to help you decide if they suit your financial goals: Understanding the Tax Advantage The utility of tax-saving FDs lies in their ability to reduce your taxable income under Section 80C of the Income Tax Act, 1961. This section allows for deductions on investments made in specific instruments. The maximum deduction allowed under this section is currently ₹1.5 Lakhs per financial year.  By deducting a portion of your investment from your taxable income, you could lower your overall tax liability and save on taxes in a fiscal year.   Investment Tenor Unlike regular FDs, tax-saving Fixed Deposits come with a mandatory lock-in period of fiv...