6 Top Fixed Income Investment Options Compared: Find out which suits you now
How to earn a fixed income through investment? This is a common question most investors have while starting an investment journey.
Fixed income investment options are the go-to plan for investors who want to save considerable money without exposing their savings to market risks. Fixed income investment options typically offer predetermined returns at fixed or notified interest rates, subject to the terms of the scheme.
Top 6 Fixed Income Investment Options in India
Here are five fixed income investment options that may offer predictable returns and relative capital stability, depending on the product structure and issuer.
1. Company Fixed Deposit
A company fixed deposit is one of the fixed income investment options offered by NBFCs (Non-Banking Financial Companies) and other financial institutions. These may offer relatively higher interest rates compared to some traditional savings products, subject to issuer risk and credit evaluation.
2. Public Provident Fund
PPF (Public Provident Fund) is a government-backed fixed income investment option. One can open a PPF account easily with banks and post offices. The tenure for a PPF account is 15 years, with the option to extend it in blocks of 5 years. The Government of India revises the interest rates periodically. Investors should check the latest notified rate before investing.
3. Senior Citizen Savings Scheme
Senior citizens, i.e. people above 60 years, can choose the Senior Citizen Savings Scheme (SCSS). As senior citizens expect a regular flow of income post-retirement, the senior citizen savings scheme may be considered as a government-backed fixed income option. One can open an account in SCSS via banks and post offices. The scheme provides quarterly interest payouts at rates notified by the Government from time to time.
4. Government Bonds
Government bonds are debt instruments through which Government raises capital for their projects and setups. They are also known as known Government securities. The maturity period of government bonds differs, and the interest rates are determined based on the total period of the bond. There are many types of Government Bonds. However, the two most common ones are Fixed Rate Bonds and Floating Rate Bonds.
5. PMVVY Scheme
Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a pension scheme for senior citizens offered through Life Insurance Corporation (LIC). The scheme provides pension payouts at rates notified by the Government at the time of subscription. The Government of India introduced this fixed income investment option to allow senior citizens to earn a steady pension income.
6. RBI Floating Rate Savings Bonds
RBI Floating Rate Savings Bonds are government-backed bonds where the interest rate is reset periodically based on a benchmark rate. These bonds are suitable for investors seeking sovereign backing along with periodic interest payouts.
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Shriram Fixed Deposit offers predetermined returns if held until maturity and is not directly linked to market volatility. The end-to-end online investment process makes investing in Shriram Fixed Deposit convenient and seamless. You may explore the FD scheme and evaluate its suitability based on your financial goals.