Firstly let’s understand what a Fixed Deposit is and how it works. A fixed deposit is a financial instrument that gives you returns when you invest in it. A fixed deposit is basically a fixed-income financial product which means that it gives you a fixed rate of interest income on the amount of money invested. It is a low-risk investment with guaranteed returns on the investments. It helps the investor grow their savings at a fixed rate of interest higher than that of the savings account.
With the increasing market volatility, a fixed deposit with high-interest rates such as the Bajaj Finance Fixed Deposit can help you get returns of up to 6.75% and hence assured and steady returns. This will help you grow your capital over time and build your savings. This will help you to plan your short and long-term financial plans with ease.
Maximum returns can be earned by investing in Fixed Deposit but you need to choose the right fixed deposit that provides you the highest interest rate and has different unique features that distinguish it from other fds and make it the best option to invest in. Bajaj Finance fixed Deposit has one of the highest returns on fixed deposits and hence is one of the best investing scheme for investing in fd. It also provides options such as the option to auto-renew your fixed deposit after the tenure or to choose between receiving the interest income on a periodic basis (non-cumulative interest income) or at the date of maturity of the Fixed Deposit (cumulative).
Choosing between a cumulative and non-cumulative interest income for the FD type is important since it makes a difference in the interest income earned. A cumulative fixed deposit gives you the complete interest earned on the investment and the principal amount invested together at the maturity date. Hence, the interest on this is compounded annually. On the other hand, a non-cumulative fixed deposit gives you interest every month according to your interest rate. Hence this interest is not compounded annually. Hence, more interest will be earned on a cumulative FD type while a non-cumulative FD will give you consistent returns. Non-cumulative fied deposit is more suited for a retired person looking for monthly income.
Once your deposit reaches its maturity, you should think of renewal of the Fixed deposit so that you can maximize your gain on this high-interest income opportunity. Bajaj Finance has an auto-renewal feature that allows you to renew the deposit while choosing them.
Another important point to increase your interest income is to file your tax returns. This will keep you up to date with the tax laws for FD returns and also keep a track on tax exemptions. To avail such tax exemption you need to file your returns with 15G or 15H forms. Lower taxes in this case, i.e. below the tax slab, will get you tax exemptions.
If you want to keep fixed deposits as financial backups, you will need to look for multiple FDs over different tenure to make your investment easy to liquidate. This not only helps you in times of need but helps you gain multiple tax benefits as you have multiple maturity dates.
These simple steps can help you a lot to maximize your interest income given the very high FD interest rate of 6.5% and stretching up to 6.75% for senior citizens making it the highest interest rate for senior citizens.
So, to conclude, to get a high-interest income for your savings you should invest in a fixed deposit. The fixed deposit scheme with the best interest rate is the Bajaj Finance Fixed Deposit. Firstly, put it interest on auto renewal mode and then choose a cumulative Fixed deposit and earn interest after the date of maturity. Then file your returns on time to avail tax benefits and keep your FDs at different maturity dates to have ease of access as well as tax benefits. Hence, you will be able to increase your income.