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Investment Types & Differences

Fixed Deposit Flexibility: How Different Investments Get Different Results

In the world of savings, Fixed Deposits hold a special place of importance. This is because they’re not only safe and secure, but also a long-term investment instrument. In fact, what makes FDs so interesting and attractive as investment options, is that one can calculate their returns on a certain amount, down to the last digit.


 

With FD Calculator, you can evaluate the amount of deposit that needs to be made, so you can gain a particular amount. Bajaj Finance offers its customers a tool on the website, to help ascertain the returns they’re liable to, with the amount they are investing.


 

Relationship Between Deposits and Returns

While most investments are seen as unstable, Fixed Deposits look more attractive because everyone stands to benefit from them. FDs make a great place for beginners to practice investment and savings.

However, just because it is a playing field for beginners, doesn't mean the regulars and the experts can’t stand to make profit. Hence, it makes more sense to ladder your investments.

Investment Details

FD by Bajaj Finance enable you to be in control of your investments. The higher your investment amount, the greater are your returns.

However, that doesn’t mean that you cannot invest a small amount in FDs. Bajaj Finance FD schemes enable you to invest in amounts as low as Rs. 25,000.

Interest rates for most FDs range between 4 to 8%. One of the highest interest rates in the market today is at 8.40%, offered by Bajaj Finance, the interest rate being higher for senior citizens. Here’s a breakdown of how you stand to benefit from them:

 
INVESTMENT AMOUNT
TENOR
MATURITY AMOUNT
CUMULATIVE INTEREST EARNED
25,000 Rs.
12 Months
Rs. 26,900
Rs. 1,900
25,000 Rs.
24 Months
Rs. 29,241
Rs. 4,241

Here you see how the same amount, left for double the tenor, yields more than double the interest earned. Now, the quickest way to increase your interest earned, is by increasing your amount of investment. This way you save on time as well. If you decide to invest for a longer tenor, you’re sure to get huge sums as returns.

Assuming you started an investment of Rs. 1 Lakh, let’s look at how that would factor out:
 
INVESTMENT AMOUNT
TENOR
RETURNS
CUMULATIVE INTEREST EARNED
1,00,000
12 Months
Rs. 1,07,600
Rs. 7,600
1,00,000
24 Months
Rs. 1,16,964
Rs. 16,964
1,00,000
36 Months
Rs. 1,27,376
Rs. 27,376

You can see how the interest earned is gradually increased with the tenor. When compared to an investment of Rs. 25,000, your returns increase substantially. This is especially improved as the sums of investment increase.

Cumulative vs Non-Cumulative Returns

Everyone knows that when investing in an FD, a cumulative return yields a higher amount. The simple difference between the two is that cumulative is taking your interest amount at the end of the tenor, and non-cumulative means taking your interest amount in either monthly, quarterly, half-yearly, or yearly payments.

Here’s a table that helps you understand this better. If you break your interest payouts into monthly, quarterly, half yearly, or yearly, here’s how things will differ:
 
CUMULATIVE EARNED INTEREST (24 Months)
MONTHLY (Interest Rate of 7.88%)
QUARTERLY (Interest Rate of 7.93%)
HALF YEARLY (Interest Rate 8%)
YEARLY (Interest Rate 8.15%)
Rs. 16,208
Rs. 15,760
 Rs. 15,860
Rs. 16,000
Rs. 16,300

The differences are jarring. The total interest earned will increase with the payment amount. So always opt for cumulative returns wherever possible.

Calculate Your Returns

If you are a new customer with Bajaj Finance, with an investment of Rs. 1 Lakh. Bajaj Finance offers higher interest rates for senior citizens, with added benefits in case of renewal.

To help senior citizens enjoy a safe and secure post-retirement life, Bajaj Finance offers interest rates of up to 8.75%. So, if you’re retiring with a lump sum in the form of PF or gratuity, investing your money in Bajaj Finance FD is your best bet.

If you decide to invest higher amounts, with cumulative returns, for a 24 or 36 Month period, here’s how your returns will look like:
 
INVESTMENT AMOUNT
INTEREST EARNED (24 Months)
INTEREST EARNED (36 Months)
Rs. 1,00,000
 Rs. 17,723
Rs. 28,614
Rs. 5,00,000
Rs. 88,613
Rs. 1,43,069
Rs. 10,00,000
Rs. 1,77,225
Rs. 2,86,139

If you plan your investment amounts with a suitable tenor with cumulative returns, fixed deposits can really serve to be the best investment tool you can possibly have. Having a flexible amount of investment can mean the difference between a great return, and a meagre income. Investing different amounts will also ensure you have a certain amount of liquidity.

Still Not Sure About Bajaj Finance FD Scheme? Read Bajaj Finance Reviews before Investing in Fixed Deposit & Visit Bajaj Finance Contact Details page to talk to our Customer Care Representative directly.
 

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