The EPF or the PF forms a major part of the retirement funds you get. Plan to keep the money secure for your future. Make some safe investments in growth instruments to keep up with inflation. You can use Fixed Deposits and other savings to secure a part of your PF funds for assured returns.
With Fixed Deposits, there is no need to worry about the principal amount, but returns may be a cause of concern. However, once you create the deposit, the prevailing interest applies. So, whether the interest rate moves up or down during the deposit tenure, the interest rate set at the time of deposit will generally not change. So, the assured amount will definitely come to you, unless you plan to withdraw money prematurely.
While FDs have definite tenors, you can break an FD before maturity in case you need funds. You will only get interest earned for the period you keep the deposit minus a penalty, which is calculated on the interest. But, you will still be able to earn an interest and get access to funds quickly.
If you want to avoid the penalties and charges involved in closing an FD before maturity, you have another option. You can take a loan against most Fixed Deposits. You can get up to 80% or even 90% of the deposit amount as loan, and the interest charged will be lesser, compared to other loans.
The advantage is that the FD will still keep earning an interest. The interest charged on the loan will only be about 1 or 2% higher than the interest paid on the FD by the bank or NBFC. In effect, you only need to pay this difference as interest on the loan.
You can open an FD for one month, one year or 10 years. You can create laddered FD savings. You can open Fixed Deposits for different durations – 1 year, 2 years, 3 years, 5 years etc.
This way, if you need emergency funds, you will have access to the funds in these deposits in one year, 2 years and so on. If you do not need the funds when the deposit matures, renew the deposit for a longer period. Generally, the longer the tenor of the deposit, the higher the interest rate.
Fixed Deposits are secure instruments that provide small, but assured returns on your investments. However on retirement, security of funds becomes more important than high growth. So, putting aside a part of your EPF Corpus in Fixed Deposits ensures that even if your growth fund investments fail, you have something to fall back on, and live life with pride.
Bajaj Finance offers company Fixed Deposits at 7.85% interest rate, one of the highest in the market. You can start with a nominal amount that is as low as Rs. 25,000. You can also apply from the comforts of your home. Start investing today, so you have secured future tomorrow.
Still Confuse? Visit Bajaj Finance Contact Us page to talk to our representative directly or check Bajaj Finance FAQ Page to clear all your doubts.
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