Quick Answer: Which Is Better MF Or FD?

Why you should not invest in fixed deposit?

Let’s say you lock money in fixed deposits for a period of 5 years.

This means, should interest rates go higher, there is a bright possibility that you would lose out.

If you break your deposit and reinvest again at higher interest rates, banks tend to cut 1 per cent for breaking the deposit..

Is Post Office FD safe?

However, post office term deposits are totally risk-free as they are backed by the government. Bank FDs are insured only up to R1 lakh. … If you are looking for a safe investment, bank FDs are suitable for you.

Is FD safe in Yes Bank?

Account holders should know that deposits with Yes Bank are insured for up to Rs 5 lakh by the DICGC. DICGC insures all deposits such as savings, fixed, current, recurring, etc. … The deposits in the joint account and his individual accounts will be insured separately under the DICGC rules for a maximum of Rs 5 lakh.

What is the interest of 1 lakh in SBI?

Interest rate on SBI savings bank deposits Currently, the interest rate on savings bank deposits on balance up to Rs 1 lakh is 3.5 per cent. On balance above Rs 1 lakh, the interest rate is 3 per cent per annum, which is set at 2.75 per cent below RBI’s Repo Rate, with a minimum of 3 per cent for the entire balance.

Which bank SIP is best?

SBI Bluechip Fund.Aditya Birla Sun Life Tax Relief 96.SBI Small Cap Fund.ICICI Prudential Bluechip Fund.Canara Robeco Bluechip Equity Fund.Kotak Emerging Equity Fund.Mirae Asset Tax Saver Fund.Tata India Tax Savings Fund.More items…

What is the best alternative to fixed deposits?

Alternatives to Fixed DepositsDebt Mutual Funds. Debt mutual funds invest in comparatively secured investment options such as corporate bonds, government securities and money market instruments. … Liquid Funds. … Equity Funds. … Corporate Fixed Deposits. … Fixed Maturity Plans. … Government Bonds.

Is Fd better than sip?

Fixed deposit is the best investment option for conservative investors only. … On the other hand, returns cannot be guaranteed in a systematic investment plan or an SIP. There is no doubt in the fact that an SIP provides higher returns in comparison to fixed deposits but there is no guarantee of returns in an SIP.

Is FD tax free?

The interest earned under an FD is taxable under “income from other sources”. The amount invested under 80C of the Income Tax Act is exempt but interest earned under such investments is taxable. … It means if the interest earned from a company deposit exceeds ₹ 5,000, the investor is liable for a TDS it.

Can you lose money in fixed deposit?

A bank FD will not be able to generate any real returns, or even negative returns, if you consider tax and inflation. Apart from losing out on returns, there is one more loss for the investor. That is, the opportunity cost of the capital set aside in FDs.

Is it a good time to invest in FD?

Wait before going for long term investment options right now. … However, if you have already invested in fixed deposits, do not just rush to take out your money right away. FD rates are at their lowest and may fall further as the situation intensifies.

Which type of FD is best?

Corporate Fixed Deposit schemes offer higher returns on your investment, but choosing the right company is imperative. If you choose a good Company FD scheme, you will generally earn more on your investment than bank FDs as these schemes offer the highest interest rate on FD.

Is FD a good option?

Fixed Deposits (FDs) are one of the safest and most preferred investment options available to those averse to investing in risk instruments such as equity and mutual funds. FDs allow you to manage your financial risks and help fulfil your goals aspired for different stages of your life.

How can I get maximum return from fixed deposit?

How to Get Maximum Returns from Fixed Deposits?Plan your investment strategy.File your returns on time.Ladder your FDs for liquidity and tax benefits.Choose Cumulative FDs over Non-Cumulative FD.Also Read: What is FD.

Which SIP is best for 20 years?

Best SIP Plans to invest in for 20 yearsHDFC growth and prudence fund. … Mirae Asset Bluechip Fund. … Franklin India Feeder. … SBI Small Cap Fund. … Motilal Oswal Equity Fund (long term) … HDFC Hybrid Equity Fund. … Aditya Birla Sun Life Fund. … ICICI Prudential fund.More items…•

Is SIP good or bad?

No doubt that SIP is a great tool. It works on the concept of Rupee Cost Averaging. However, to start a SIP with the belief that nothing could go wrong if you invest through SIP is foolhardy. Over 80% of the investors have entered the mutual fund world in the last five to six years.

Which bank is best for FD 2020?

Fixed Deposit Interest Rates 2020BanksFD Interest RatesTenureHDFC3.00% – 6.25%7 days to 10 yearsPNB Housing Finance7.20% – 8.00%12 months to 120 monthsICICI Bank3.25% – 6.25%7 days to 10 yearsAxis Bank3.50% – 6.75%7 days to 10 years3 more rows

Can I open FD for 3 months?

If you want to invest in an FD for 3 months, you can get a decent rate of return. For instance, AU Bank offers 6.90% for regular citizens on their FD. If you’re a senior citizen, you can get 7.40% p.a. on your investment for 3 months.