Can I withdraw my FD before the maturity date?

You can withdraw your fixed deposit (FD) before its maturity date, though a penalty may apply to the transaction. Knowledge of these conditions will enable you to make wise decisions.

• Financial institutions generally let you withdraw an FD early, but it depends on the terms and conditions set when you start the FD. Check the T&C beforehand or ask for details from your financial institution.
• If you withdraw funds from the FD before maturity, you'll likely face a penalty. This penalty usually has a lower interest rate. This varies across financial institutions.
• Some FDs have a minimum lock-in period (typically a minimum of 12 months) during which you must keep the money. Withdrawing during this time might not be allowed or could result in a bigger penalty. You can also consider a loan against FDs if you need urgent funds without the need to break the FD.
• When you withdraw early, you typically earn interest only when the FD was held, not for the full term. Some banks or NBFCs might allow partial withdrawals, but this varies.
• Withdrawals made early from FDs affect your financial planning because they are intended for long-term use.