You can earn great interest and get better returns with time if you invest in fixed deposits. But also remember that the interest rates are not going to be very high in this category of investments. A savings account or bank account will not provide you with a lot of interest, but they are very safe and secure options to park your money. If you want to get involved in investment activities there are many other options available like mutual funds, scrips, unit linked schemes etc.
So, how do you make a rational decision? Whatever your choice may be, it is logical to keep one’s money safe. By depositing your hard-earned money in a fixed deposit account with a bank or a financial institution, you are ensuring yourself against unanticipated events that could happen to your savings and other assets which are usually not covered by insurance policies.
A savings account is a type of bank account that provides a safe place to park all your money. The more you deposit into your savings account, the higher the interest rate on that money. You can save up money to buy things by having different accounts, or you can use it as an emergency fund in case something bad happens.
A savings account is a type of bank account from which money can be deposited, withdrawn and transferred by cross-checking against the balance. You know what that means, right? You could make up your mind about when you wish to withdraw the amount at your disposal. Moreover, depending upon the bank that you are planning to choose, there are some banks which even offer monthly compounding interest on the amount deposited. This type of interest rate is a lot higher than what you get on other schemes of fixed deposit.
Types of Saving Account
There are various types of saving accounts such as:
1. Regular Saving Account
Regular savings accounts are the most basic type of bank accounts that you can open with your bank. These are designed for people who want to keep their funds safe in a bank account with minimal hassle, but still get access to the cash when needed.
2. Salary-based Saving Account
Salary account is an account that is opened in the name of any worker by his organization through which he receives his monthly salary. The bank also provides various other services for this account such as debit cards, ATM cards and internet banking facility to manage the account easily.
3. Senior Citizens Saving Accounts
This account is similar to a regular savings account. However, it offers senior citizens the opportunity to earn higher interest rates on their money. Senior citizens often use this account when they retire and no longer receive a pension or fixed deposit. These accounts are linked to other senior citizen saving schemes and consolidate funds from retirement accounts and pension funds.
FDs are considered to be one of the most important and sought-after investment instruments in India. For years, FDs have been invested by people who want to park money for a longer tenure so as to receive guaranteed returns. They are profitable because the customers tend to receive the same interest rate on their deposit after their tenure ends even if interest rates rise or fall further. In addition, customers also earn interest on their deposited amount which helps them accumulate a substantial amount at the time of return.
Fixed deposits are one of the most popular option of investment for people. The reason behind their popularity is that they come with a certain amount of security and guarantee. These deposits are available for different periods from 7-14 days to even 10 years. Therefore, Fixed deposits are known as Term Deposits at various Banks and NBFCs.