Post Office Saving Schemes
There are different types of post office saving schemes like the Public Provident Fund (PPF), SukanyaSamriddhi Accounts (SSA), Post Office Monthly Income Scheme Account (POMIS), National Savings Certificate (NSC), 5-Year Post Office Recurring Deposit Account (RD), Senior Citizen Savings Scheme (SCSS) and more. Fixed Deposit (FD) in a post office or a post office term deposit entails setting aside a fixed sum of money for a fixed tenure and interest rate. FD in post offices offers tenors ranging from 1, 2, 3 to 5 years, and the interest is calculated quarterly and paid to the investor on an annual basis.
But, if an FD in the post office is not something that you would like to include in your savings plan, you can opt for a Fixed Deposit scheme with a bank or NBFC (Non-Banking Financial Company) that offers higher interest rates. Let's understand more about it.
Reasons to Include Fixed Deposit in your Savings Plan
Fixed Deposits are highly popular among individuals who have a low tolerance for risk. If you have a lower risk appetite, here are some reasons why you must choosing to save with a fixed deposit:
Different assets play different roles in the investment portfolio. Fixed Deposits are considered to be safer savings options, as they provide guaranteed returns and stable savings, unlike equities, stocks and mutual funds that are affected by market fluctuations.
A Fixed Deposit offers a lot of flexibility in terms of tenor that can range from 6 months to a period of 10 years. This time period ensures that an investor gains maximum returns on their investment over a fixed period of time.
Most banks and non-banking financial companies offer a credit facility in the form of a loan or overdraft to those who hold fixed deposit accounts. When you need money immediately, you can borrow funds through this facility without prematurely terminating your Fixed Deposit. You can borrow up to 75% of your Fixed Deposit amount.
A Fixed Deposit allows for easy withdrawal of funds even before the end of the tenor. It is quite simple to withdraw funds prematurely though you may have to pay a small penalty for it. But, this facility definitely helps you get urgent funds in times of emergency.
5. Short-term Goals
Short-term goals are goals that one may want to achieve in the near future. A Fixed Deposit is one of the best savings options if you want to achieve your short-term goals. By saving with a Fixed Deposit, you can preserve the principal amount and at the same time earn some interest. For instance, short-term goals can be like a family trip you may want to take in the coming year or purchasing an appliance for your house next year. Choosing a Fixed Deposit can fulfill such short-term goals as you can suitably invest and know your expected returns at the time of investment.
Choose Fixed Deposits That Give Up To 8.75% Returns
There are banks and financial institutions where one can open up a Fixed Deposit. But before you open a Fixed Deposit account with any financier, you need to compare your options and choose an issuer offering the features and benefits you’re looking for. And when you’re comparing Fixed Deposits, you’ll find that the Fixed Deposit interest rates differ from financier to financier. So while making a choice, research the dependable and trustworthy banks and non-banking financial companies that offer the highest rate of interest on Fixed Deposits.
If you’re hoping to skip post office fixed deposit schemes, you can look up for banks and other financial institutions to expand your savings plan and secure your future in the best way possible.
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