Fixed Deposit

Features of a Fixed Deposits

• Minimum deposits of Rs. 25,000/-.
• Higher rate of interest.
• Safest investment
• No risk of income
• Not dependent on the market fluctuations.
• Greater returns to senior citizens.
• Easy to withdraw

Types of fixed deposits

Regular Fixed Deposits

These Fixed Deposits are regular type of FDs. Interest rate is higher than saving account. Money is fixed for a fixed period at a fixed rate of interest. Withdrawal cannot made before maturity. In case of urgency, a penalty would be charged at the time of withdrawal.

The interest paid is generally compounded quarterly.

Income on Fixed deposits are taxable in the hands of the individual, thus TDS is deducted from the interest at the time of the payment of interest by banks/NBFCs.

Senior Citizen Fixed Deposits

These are the regular type of fixed deposits available for the senior citizen at a higher rate of interest. Senior Citizens usually gets the 0.5% increased rate of interest than the regular fixed deposits.

The interest paid is generally compounded quarterly.

Income on Fixed deposits are taxable in the hands of the individual, thus TDS is deducted from the interest at the time of the payment of interest by banks/NBFCs

Tax Saving Fixed Deposits

This fixed deposits have the minimum fixed tenure of 5 years. The depositor gets the benefit of maximum deduction of Rs. 1.5 Lacs per year under this scheme.

Fixed deposit cannot be break before 5 years.

Flexi Fixed Deposits

Money is deposited in the flexi fixed deposit account which is linked with a savings bank account. In case of any demand of money the bank sweeps in money to your saving account from your flexi fixed deposit account. As soon as you have excess amount in your saving account you can swap it to your flexi fixed deposit account.

While making a Fixed Deposit one has to be careful with every possibilities and terms and conditions of all the schemes before choosing for same.