Fixed Deposits
A Fixed Deposit (FD) is an investment where an individual deposits a lump sum amount with a financial institution for a specific period. The amount deposited earns interest at a fixed rate set at the time of opening the FD. Investors can choose to receive the interest earned on a monthly, quarterly, half-yearly, or annual basis, depending on their preference.
How does an FD work?
When individuals open an FD Account, they need to deposit a specific amount. When individuals open an FD Account, they need to deposit a specific amount of money for a predetermined period. The amount deposited should not be withdrawn until the maturity of the deposit. The period of investment can range from 7 days to 10 years, depending on the investor’s preference.
The interest rate offered on an FD depends on the period of investment and the amount deposited. The longer the investment period, the higher the interest rate and the higher the interest earned. The interest earned on an FD gets credited to the investor’s Account or gets reinvested in the FD at the end of the tenure.
Features and benefits of a Fixed Deposit (FD)
Drawbacks of a Fixed Deposit (FD)
Types of Fixed Deposits
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