Both bank fixed deposits and corporate fixed deposits are popular fixed-investment plans of India. The reasons for the same are the low-risk profiles and guaranteed returns. But making fixed deposits of idle funds is not the end of the story. You must make efforts to keep your FD money safe through the best investment ideas.
Here are some investment ideas that help you in reaping the benefit of secured FD schemes
Go with the option of corporate deposits
For the past few months, many fixed deposit schemes have been begun by the banks. Money is lying idle with the banks, but nobody is willing to make fixed deposits because of the reduced FD return rate. However, this is not the case if you make corporate deposits of the surplus money lying idle in your bank accounts. The return is higher in corporate deposits on any day. It is the first step of ensuring that your FD money is safe through the best investment ideas.
To keep your FD money safe, always look for the right financial institution
The next step towards keeping money safe through the best investment ideas is to search for the best corporate fixed deposit schemes. Choose one that offers a high and guaranteed rate of interest on the fixed deposit. But apart from these two factors, it is important to check the history of the corporations, its credit rating, financial performance, deposit base, etc. For instance, suppose you have finalized two corporations; if the difference in the interest rate is only 0.5%, then you must choose the one that enjoys a better position and credibility in the financial market. If you are going with online fixed deposits, it becomes easier to compare and choose the most suitable one for you.
Choose the cumulative scheme for getting the interest payments
Once you have decided to invest money in corporate deposits. The next step is making efforts to maximize the returns of the FD money. When you choose any of the FD schemes, the company gives you two options. One is non-cumulative, and the other is a cumulative deposit scheme. If you are going with the cumulative option, the interest will be added with the principal amount and credited to your account at the time of maturity. This results in getting higher returns on the principal amount.
Go with the ladder investment strategy
Suppose you have decided to go with a cumulative scheme where you are getting the interest on maturity. But what will you do at times of financial emergency? Go with the ladder investment strategy. Using this strategy, one can easily split the investment amount into multiple fixed deposits by setting different maturity times for each amount.
If you wish to book an online fixed deposit of Rs 2,50,000, using the ladder strategy, you can invest the amount by making 5 fixed deposits of Rs 50,000 each with maturities like 1 year, 2 years, 3 years, and so on. After the deposit matures, if you do not have any funds requirement, go for re-investment. There are mainly two benefits of using the ladder investment strategy: getting liquidity frequently, and, secondly, it also affects the changes in the interest rates.
RBI floating saving rate bonds
The RBI saving bonds are also one of the best ways of keeping the FD money safe. It comes with a seven-year maturity period. The best thing about this investment idea is that every six months, the interest rate of the saving bond changes. Unlike other bonds, RBI saving bonds are non-tradeable in the secondary market. The interest applicable on RBI saving bonds is taxable, and deduction takes place when interest is credited to your account.
Check the ICRA rating Fixed Deposits
The corporates that are offering fixed deposits always get ICRA ratings. When you are making a fixed deposit with any corporation, always check the credit rating. It helps in signifying the risk factor involved in investing your hard-earned money in any of the company's fixed deposits. The ICRA decides the rating only after evaluating the company's credibility. The higher the credit rating of the corporation, the safer the fixed deposit. You can earn an impressive interest on the fixed deposit amount. Go with those whose credit rating is just a bit lower than the highest rating.
To keep FD money safe, go with longer tenure
The corporation usually offers higher interest rates on those online fixed deposits that have a longer tenure. If you do not anticipate liquidity requirements in the near future, opt for a longer tenure fixed deposit. It is one of the simplest ways of keeping your FD money safe.
FD for senior citizen
If you want to keep the FD money safe for your parents or yourself as a senior citizen, go with the senior citizen fixed deposit scheme. It is one of the best saving schemes.The interest rate offered in senior citizen fixed deposit schemes are quite higher. It is almost 0.50%* p.a. as compared to an individual fixed deposit scheme. The senior citizen scheme is available with the regular interest pay-out option. So that they will be getting a reliable and steady income after the age of 60 years at frequent intervals. One can also avail loan against the SCSS at times of financial emergencies. Online you can compare and choose the best FD rates for senior citizens
The senior citizen saving scheme comes with a 5-year tenure. But at the request of a senior citizen, it is extendable for 3 more years. The upper investment limit of the FDS for senior citizens is Rs 15 lakh. The interest payment takes place quarterly or annually as per the fixed deposit holder.
Always keep the nomination option
If you want to keep your FD money, don’t forget to select the nomination option. If you are the sole depositor, the nominee must be mentioned. In the event of death, the nominee can claim the money and your FD money will go in the right hands.
Use of the online FD calculators
To keep your FD money safe and to choose the right tenure, use an online fixed deposit calculator. It is also known as a compound interest calculator. Based on the rate of interest offered on the FD deposit scheme, using the calculator, you can easily calculate the return on the principal amount invested.
Above, we have discussed the best and safe investment ideas to make your FD money grow. Among all the fixed deposits, the corporate fixed deposit proves to be one of the best combinations of high returns and low-risk. If you are investing after doing proper research, check your credit ratings to ensure that you are choosing the right investment plan. If you are looking for a secured investment scheme, invest in Shriram Unnati Fixed Deposits. It is accredited with [ICRA]AA+ (Stable)” by ICRA and "IND AA+/Stable" by India Ratings and Research. It is always wise to invest the surplus savings in a fixed deposit plan rather than leaving idle in bank saving accounts.