We have often heard of situations where people have invested in diverse assets only to incur losses in the future. There are several investment avenues available for citizens in India but one should always choose wisely. In this context, it is wise to mention that opting for Fixed Deposits is probably the safest option that you can consider.
It is important to consider your own risk appetite before investing. If you want a completely risk-free and secure investment, then you should invest in FD instead of going for market-linked investment options. By market-linked investment options, you can consider options like mutual funds, equity funds and shares and stocks. However, these investment options are extremely risky since they are dependent on fluctuations and changes in the market. There have been umpteen situations where people have required money urgently and have been forced to sell off their shares/investment assets at lower prices due to market fluctuations. These investments may seem to offer tempting returns but they are riskier and you may burn your fingers if you do not possess expertise in this arena.
Several people have also invested in real estate ahead of FDs but real estate is also a volatile asset class. This is because the prices of real estate have corrected in the current scenario and may go down further. Also, real estate is not really a liquid investment, i.e. you cannot sell any property immediately and also there is the issue of stringent taxation policies. All these things combine to make it an avoidable investment at present. If you consider jewellery including silver, gold and other precious metals, their prices are also volatile at present and can fluctuate, leaving the value of your investment in the doldrums.
As a result, it is always best to invest in a Fixed Deposit. You can grow your money handsomely without having to worry about any risks. Fixed deposit interest rates are pre-fixed along with the tenors and are not dependent on any market circumstances while your principal investment is also totally secure. You can use an FD calculator online to find out the interest income that you will be getting from your investment. Compare interest rates offered by various lenders and choose the one that suits you best. Fixed Deposits remain the safest investment option and theÂ mostÂ referred avenue for wealth creation in India. Fixed Deposits are ideal for making lump sum investments.
While the interest income from an FD is taxable, you can invest in tax-saving FDs with specified lock-in periods. Another advantage is that you can get loans against your fixed deposit. You can get loans up to 70% or even more of your fixed deposit without having to break the same prematurely. For higher returns, you can choose to compound your interest every year and receive the full amount at the time of maturity. If you wish to earn a regular income, you can choose monthly/quarterly/half-yearly/annual payouts of the interest income.