It is a well-acknowledged fact that idle money is a killer of savings because it does not inherently appreciate and does not beat inflation. It is why investing your savings becomes a crucial step in pursuit of growing wealth. However, choosing the perfect option can be challenging.
Fixed Deposits (FD) and Recurring Deposits (RD) are favourable investment tools financial institutions offer. It is because both the instruments are safe, fixed income and low-risk. But the FD scores better when it comes to earnings with another set of other benefits. Let’s look at both investment plans to understand the differences better.
All about the Fixed Deposit (FD)
Generating wealth is a steady process that requires regular saving and investing. The Fixed Deposit is an all-time favourite investment option for Indian investors. The FD is suitable for all investors, especially because it is a safe tool. Bank FDs generally offer lower interest rates as compared to company FDs. Company FDs like Bajaj Finance offer both safety and attractive FD interest rates.
Here is why the Bajaj Finance Fixed Deposit is a good option.
- Certainty of return
The Bajaj Finance Fixed Deposit guarantees the highest deposit safety. It has been credited with the highest [ICRA]AAA(Stable) and CRISIL AAA/STABLE ratings by India's leading credit rating agencies.
- Impressive returns
Bajaj Finance FD offers fixed deposit interest rates up to 7.95% p.a. making it one of the highest interest rates any financial institution provides.
Here is a look at the interest rates offered to investors below 60 years of age.
*Special interest rates are offered on tenure of 15, 18, 22, 30, 33, 39 and 44 months.
|
Cumulative (interest +principal amount paid at maturity) |
Non-cumulative (interest paid at a defined frequency, principal paid at maturity) |
|||
Tenure in months |
At Maturity (p.a.) |
Monthly (p.a.) |
Quarterly (p.a.) |
Half Yearly (p.a.) |
Annual ( p.a.) |
12-14 |
6.80% |
6.60% |
6.63% |
6.69% |
6.80% |
15* |
6.95% |
6.74% |
6.78% |
6.83% |
6.95% |
16-17 |
6.80% |
6.60% |
6.63% |
6.69% |
6.80% |
18* |
7.00% |
6.79% |
6.82% |
6.88% |
7.00% |
19-21 |
6.80% |
6.60% |
6.63% |
6.69% |
6.80% |
22* |
7.10% |
6.88% |
6.92% |
6.98% |
7.10% |
23 |
6.80% |
6.60% |
6.63% |
6.69% |
6.80% |
24-29 |
7.25% |
7.02% |
7.06% |
7.12% |
7.25% |
30* |
7.30% |
7.07% |
7.11% |
7.17% |
7.30% |
31-32 |
7.25% |
7.02% |
7.06% |
7.12% |
7.25% |
33* |
7.30% |
7.07% |
7.11% |
7.17% |
7.30% |
34-35 |
7.25% |
7.02% |
7.06% |
7.12% |
7.25% |
36-38 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
39* |
7.60% |
7.35% |
7.39% |
7.46% |
7.60% |
40-43 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
44* |
7.70% |
7.44% |
7.49% |
7.56% |
7.70% |
45-60 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
Senior citizens get additional rate benefits of 0.25% p.a. on their deposits.
Here is a table of the latest interest rates senior citizens can get on their deposits.
*Special interest rates are offered on tenure of 15, 18, 22, 30, 33, 39 and 44 months.
|
Cumulative (interest +principal amount paid at maturity) |
Non-cumulative (interest paid at a defined frequency, principal paid at maturity) |
|||
Tenure in months |
At Maturity ( p.a.) |
Monthly (p.a.) |
Quarterly (p.a.) |
Half Yearly (p.a.) |
Annual (p.a.) |
12-14 |
7.05% |
6.83% |
6.87% |
6.93% |
7.05% |
15* |
7.20% |
6.97% |
7.01% |
7.08% |
7.20% |
16-17 |
7.05% |
6.83% |
6.87% |
6.93% |
7.05% |
18* |
7.25% |
7.02% |
7.06% |
7.12% |
7.25% |
19-21 |
7.05% |
6.83% |
6.87% |
6.93% |
7.05% |
22* |
7.35% |
7.11% |
7.16% |
7.22% |
7.35% |
23 |
7.05% |
6.83% |
6.87% |
6.93% |
7.05% |
24-29 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
30* |
7.55% |
7.30% |
7.35% |
7.41% |
7.55% |
31-32 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
33* |
7.55% |
7.30% |
7.35% |
7.41% |
7.55% |
34-35 |
7.50% |
7.25% |
7.30% |
7.36% |
7.50% |
36-38 |
7.75% |
7.49% |
7.53% |
7.61% |
7.75% |
39* |
7.85% |
7.58% |
7.63% |
7.70% |
7.85% |
40-43 |
7.75% |
7.49% |
7.53% |
7.61% |
7.75% |
44* |
7.95% |
7.67% |
7.72% |
7.80% |
7.95% |
45-60 |
7.75% |
7.49% |
7.53% |
7.61% |
7.75% |
All about the Recurring Deposit (RD)
Various financial institutes in India offer the facility of a recurring deposit (RD) account. The RD is a very reliable investment tool ensuring the safety of invested money. One can make periodic deposits and earn sizeable returns on the investment at maturity. You can start an RD with an investment of just Rs. 500. This savings plan is ideal for risk-averse investors. Returns generally vary between 5% to 8% p.a.
Here are some of the highlights of the Recurring Deposit (RD)
- Guaranteed returns
This savings instrument is not market-linked; it is a fixed-income instrument. Recurring deposits give assured returns to investors. - Fixed interest rate
The RD interest rates are locked-in at the time of booking the RD, and it remains the same throughout the chosen tenure. Making it easy to calculate returns at maturity.
After going through this information, you can now evaluate your options and choose an investment plan that suits you best. However, as you can see, the returns provided by company FDs like Bajaj Finance Fixed Deposit can get you more earnings than the recurring deposit.
