Is it safe to put your savings on a bank fixed deposit?

Posted on Thursday, March 2nd, 2023 | By IndusInd Bank

Whether you’re a salaried employee or a business owner, it is essential to save money for rainy days. Savings provide a financial cushion for the uncertainties of life and provides a sense of security and peace of mind. But saving money is easier said than done.

To save money smartly, you first need to determine what you are saving money for. It can be for buying a car, for your child’s education or for a stress-free retirement. Once this is clear, you need to determine how much money do you need to save in order to reach your goal. Accordingly, you must calculate how much can you save each month after taking care of all your expenses. You should find the right type of account for your savings goal. Fixed Deposits are an excellent way to build up your savings while earning some interest on your money. FDs will earn you a return on your funds with no risk involved at all.

Benefits of saving money via FDs

Fixed deposit accounts are an investment instrument offered by the banks where you can park your money for a fixed tenure at a fixed interest rate. This tenure ranges from seven days up to ten years, and it varies across banks. The return on investment is compounded periodically; it may be monthly, quarterly, or annually. Additionally, you can also invest in tax-saver FD schemes. Upon maturity of the FD account, you can even reinvest the sum for another term to earn more returns. The biggest advantage of FD is that the returns are guaranteed as they are not linked market fluctuations like other investment options.

Let’s take a look at benefits of saving money via Fixed Deposits:

1. You earn guaranteed returns: Other investment options such as mutual funds or stocks are subject to market risk, and have elements of volatility & uncertainty associated with them. Fixed deposits are not affected by the ups and downs of the market. The rate of interest that you will enjoy on your funds will stay unchanged for the entire tenure of investment. This is why FDs have always been a go-to savings option in India due to the stability and growth it offers to the investors.

2. You enjoy flexibility: Depending upon your savings goal, you can choose FD with a tenure of 7 days to as long as 10 years. You can also enjoy flexible interest rate pay-outs and choose to receive the interest amount in regular intervals i.e., fortnightly, monthly, quarterly or yearly basis or upon maturity.

3. You can withdraw FD easily: In case of financial emergency, selling investment options such as stocks or real estate is time-consuming. Additionally, you may sell them for a much lower rate due to urgent need of funds. IndusInd Bank FDs can be easily liquidated without any hassle. A premature withdrawal may attract a nominal charge, and is meagre compared to what you may lose while selling other investments.

4. You reduce your tax outgo: By investing in IndusInd Bank tax saver FD, you can claim tax deduction under section 80C of the Indian Income Tax Act and reduce your total tax outgo.

5. You improve your savings habit: It is very easy to spend money when its readily available. Since FDs require you to keep a certain amount for a specific period to earn interest, you feel encouraged to save.

Conclusion: It is safe to put your savings in an FD!

A Fixed Deposit is one of the safest options to put your savings in. Not only are FDs immune to market risks, you also earn attractive interest rates with IndusInd Bank. We also offer special interest rates to senior citizens on booking an FD.

Opening a fixed deposit account with IndusInd Bank is very easy! To grow your savings with flexible tenure and high interest rates without any bank visits, click here.

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.