Fixed deposit investors need to remember, however, that they cannot withdraw money before maturity without financial repercussions. In emergencies, early withdrawal is possible after the payment of penalties.
Types of FDs Available
There are several fixed deposit types that investors need to know about before investing. Without such knowledge, you may end up picking up plans not suitable to your investment objectives. Listed below are some of the common options open to prospective investors.
- Corporate fixed deposits
- Standard fixed deposits
- Senior citizen fixed deposit
- Tax-saving fixed deposit
- Cumulative fixed deposit
- Non-cumulative fixed deposit
- Flexi fixed deposit plans
- NRO fixed deposit account
- NRE fixed deposit account
There is no fixed rate on FD investments. The rate of return for an investor greatly depends on the bank or NBFC offering the investment option. Each bank provides different interest rates on deposits.
Portfolio management involves building and overseeing a selection of investments that will meet the long-term financial goals and risk tolerance of an investor.
We are using a product mix of different products to balance your portfolio which is as under.
Mutual fund investments are becoming very popular with individual investors because of the benefits they provide. Among the many advantages, the most important factors that drive investors to mutual funds are that Investors can.
While investing, you must be aware of the advantages of mutual funds. Once you know that, you must learn about its disadvantages. Only by comparing the advantages and disadvantages of mutual funds can you choose the best fund for yourself.
Comparison of Mutual Funds with Other Investment Products
As inflation decreases the value of money over time, it becomes important to invest in a correct channel. An unused amount, if not invested will lose its purchasing power.
Equities are the highest in the risk and return matrix while savings postal services are on the lower side of risk and return matrix. You must invest according to the amount of risk you are willing to take.
The other option is time horizon: short term, medium term or long term.
Check out our Fundz Plus platform for investing in mutual funds online without any paperwork.
NCDs
Non-convertible debentures (NCD) are fixed-income instruments, usually issued by high-rated companies in the form of a public issue to accumulate long-term capital appreciation. They offer relatively higher interest rates when compared to convertible debentures.
Non-convertible debentures fall under the debt category. They cannot be converted into equity or stocks. NCDs have a fixed maturity date and the interest can be paid along with the principal amount either monthly, quarterly, or annually depending on the fixed tenure specified. They benefit investors with their supreme returns, liquidity, low risk and tax benefits when compared to that of convertible debentures.
Bonds
A bond is a fixed income instrument that represents a loan made by an investor to a borrower (typically corporate or governmental). A bond could be thought of as an I.O.U. between the lender and borrower that includes the details of the loan and its payments. Bonds are used by companies, municipalities, states, and sovereign governments to finance projects and operations.
Categories of Bonds
There are four primary categories of bonds sold in the markets. However, you may also see foreign bonds issued by corporations and governments on some platforms.
Corporate bonds are issued by companies. Companies issue bonds rather than seek bank loans for debt financing in many cases because bond markets offer more favorable terms and lower interest rates.
Municipal bonds are issued by states and municipalities. Some municipal bonds offer tax-free coupon income for investors.
Government bonds such as those issued by the U.S. Treasury. Bonds issued by the Treasury with a year or less to maturity are called “Bills”; bonds issued with 1–10 years to maturity are called “notes”; and bonds issued with more than 10 years to maturity are called “bonds”. The entire category of bonds issued by a government treasury is often collectively referred to as “treasuries.” Government bonds issued by national governments may be referred to as sovereign debt.
Agency bonds are those issued by government-affiliated organizations such as Fannie Mae or Freddie Mac.
The bond market tends to move inversely with interest rates because bonds will trade at a discount when interest rates are rising and at a premium when interest rates are falling.
The National Pension Scheme is a social security initiative by the Central Government. This pension programmed is open to employees from the public, private and even the unorganized sectors except those from the armed forces. The scheme encourages people to invest in a pension account at regular intervals during their employment. After retirement, the subscribers can take out a certain percentage of the corpus. As an NPS account holder, you will receive the remaining amount as a monthly pension post your retirement.
NPS scheme holds immense value for anyone who works in the private sector and requires a regular pension after retirement. The scheme is portable across jobs and locations, with tax benefits under Section 80C and Section 80CCD.
| Particulars | NPS Tier-I Account | NPS Tier-II Account |
| Status | Default | Voluntary |
| Withdrawals | Not permitted | Permitted |
| Tax exemption | Up to Rs 2 lakh p.a.(Under 80C and 80CCD) | 1.5 lakh for government employees Other Employees-None |
| Minimum NPS contribution | Rs 500 or Rs 500 or Rs 1,000 p.a. | Rs 250 |
| Maximum NPS contribution | No limit | No limit |
You can start online investment directly on the NSDL portal, follow the below link to start investing now!
https://npscra.nsdl.co.in/
Real estate can be sound investment, and one that has the potential to provide a steady income and build wealth. Still, one drawback of investing in real estate is illiquidity: the relative difficulty in converting an asset into cash and cash into an asset.
There are few things that you should know before you invest in share market. Investing in stocks provide high returns due to the power of compounding effect. A trading and demat account are a must to start trading in the stocks. Don’t worry! It’s not a cumbersome process and it can be opened very easily online and quickly with no hassle.
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