FD Tips: Know these 3 things before making FD, otherwise you will suffer a big loss..
In today's time, you will undoubtedly get many investment options, but Fixed Deposit is still considered a better means of investment. Your money remains safe in FD and you get guaranteed returns.
Apart from this, you can invest in FD for 7 days to 10 years. For some time now, interest in FD has been good in many banks. However, different interest rates are available on FD in different banks. If you are also going to invest your lump sum amount through a fixed deposit, then understand three things clearly. You will never lose money due to this.
Choose the right tenure
Before investing in an FD, think carefully about its tenure, this is because if after investing in an FD, you break it before maturity, then you have to pay a penalty for it. In such a situation, you do not get the interest on FD for which you invest the money. If the FD is broken before it matures, a penalty of up to 1 percent has to be paid.
Do not invest all your money in one FD
If your amount is large and you want to invest it in an FD, then do not invest it all at once in one place but invest it in many different FDs. Suppose you have Rs 5 lakh, then you can create 5 FDs of Rs 1 lakh each. Fix each FD for different tenures ranging from 1 year to 5 years. This is called the FD Laddering Technique. When you invest through this, your FD matures every year and you remain with sufficient liquidity.
Suppose you fixed money for 1, 2, 3, 4, and 5 years. In this situation, you have 5 FDs. The first FD will mature in 1 year. Whatever interest you have on this FD, you should get the entire amount including that interest fixed again for the next 5 years. Your second FD will mature in the second year. In this way, you have to re-fix the FDs maturing every year one by one for the next 5 years. In this way, you will get the FD fixed every year with the increased amount including interest, and then interest will be earned on that entire amount. In this way, you can earn a lot of profit through this.
Tax saving FD
FD investors should also know that if you fix the amount in FD for 5 years, then you can also avail tax benefits on it. 5 year FD is called Tax Savings FD. By investing in this, you can claim a deduction of Rs 1.5 lakh under Section 80C of the Income Tax Act. This way you can benefit yourself.
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