Whether a conservative or an aggressive investor, a salaried or a business person, a housewife or a citizen senior – term deposits have been popular across all age, income groups and investment risk profiles for decades in India. With assured returns, the safety of investment and easy liquidity, term deposits always come to the rescue of investors during any kind of financial crisis. 

However, term deposits interest rate and features vary from one financial institution to another. Hence, it is advisable to keep the following 6-point checklist in mind.

  1. Interest Rate

While the term deposit interest rate offered by most banks or government FD schemes are attractive, they are not at par with a company FD. A case in point is Bajaj Finance FD which offers a high interest rate up to 7.35% – this is among the best rates in 2020.

It is recommended to use a term deposit calculator to compare the returns across different FDs. You can use Bajaj Finance FD interest rates calculator as it is one of the most reliable and accurate online tools to calculate both cumulative and non-cumulative returns on term deposits beforehand.

  1. Safety and Credibility

When you invest in a term deposit, check the trustworthiness of the financial institution and safety net offered on your returns. Bajaj Finance is the only Indian NBFC which has received ‘BBB’ international rating from S&P Global. Bajaj Finance FD also has the highest stability ratings of FAAA/Stable by CRISIL and MAAA/Stable by ICRA.

  1. Tax Benefit

A tax saving FD offers tax exemption of up to Rs. 1.5 lakh under Section 80C of the Income Tax Act. However, it has a lock-in period of five years. On the contrary, term deposits like Bajaj Finance FD allow you to withdraw prematurely at marginal penalty rate or avail loan up to 75% of FD in case you need emergency cash. You can even avail TDS exemption by providing 15G/15H if you are eligible for it.

  1. Online Facility

Are you looking for convenience to open your term deposit online? Then, Bajaj Finance term deposit fits the bill perfectly. It is a paperless formality which takes only a few minutes of your time. Most importantly, Bajaj Finance online FD offers an additional interest rate of 0.10% over and above the base rate to help you grow your savings further.

  1. Flexible Options

A term deposit should offer flexible features to meet your financial goals. For example, Bajaj Finance FD gives you flexible options like tenor from 12 to 60 months and periodical interest payouts. You can choose the frequency of the periodic interest payouts as per your need for cash. If you opt in for periodic interest payouts, you can receive monthly, quarterly, half-yearly or annual payouts to fulfil ongoing expenses. However, if you do not opt for periodic payouts and instead take the entire interest amount upon maturity, you can build a substantial corpus to meet your future financial goals.

  1. Laddering

What if you could maximize the returns on your term deposit and earn more interest income? Well, the laddering technique enables you to do exactly that. But, very few term financers such as Bajaj Finance offer an option to ladder your deposits. Instead of locking your term deposit in a single FD, you can spread the principal amount across different tenor and interest payment frequencies. This will help you to meet your short-term and long-term investment goals. It will also give you leverage to withdraw money from a single deposit as and when required.

Author Bio:

Gaurav Khanna is an experienced financial advisor, digital marketer, and writer who is well known for his ability to predict market trends. Check out his blog at HighlightStory.

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