Fixed Deposit for Home Expenses
Planning home repairs or home improvements can be an interesting aspiration, but it often comes with significant costs. Costs such as ongoing EMIs towards the housing loan or unexpected repairs may drain savings. However, an FD (Fixed Deposit) built over time can be a financial cushion for your home expenses. You can use the principal for large expenses or the interest to cover smaller repairs.
By investing in a fixed deposit (FD), you can plan your home expenses and enhance your home’s look, cover regular household costs, or spend on making simple home fixes. At Shriram Finance, our FD helps you achieve these goals with ease. Shriram FD provides one of the highest interest rates in the industry of up to 8.15%* p.a., inclusive of 0.50%* p.a. for senior citizens and 0.05%* p.a. for women depositors, with flexible tenures to steadily grow your savings for home expenses.
Why Should You Choose an FD for Home Expenses?
Fixed deposits are a great source of funds for home expenses. Here are some of the benefits of FD for home expenses:
Steady Returns: FDs typically offer predictable returns on your principal amount and are not fluctuating based on market conditions. This fixed interest rate provides peace of mind, allowing you to budget accurately for your renovation costs.
Flexible Tenures: If you are going for minor home improvements or doing a full-scale renovation, FDs provide flexible tenure options. Shriram FD provides tenure options ranging from 12 to 60 months.
Competitive Interest Rates: Fixed deposits generally provide higher interest rates compared to a regular savings account. For example, Shriram Unnati Fixed Deposit offers interest rates as high as 8.15%* p.a. (inclusive of 0.50%* p.a. for senior citizens and 0.05%* p.a. for women depositors).
Preservation of Principal: FDs offer steady, predictable returns since they are not market-linked investments. Additionally, the principal amount that you invest as capital in an FD usually remains intact during maturity.
Factors to Consider When Choosing a Fixed Deposit for Home Expenses
Here’s what you must consider when using FDs to cover your expenses for home:
Interest Rates
You may compare the rate of interest offered by different financial institutions to ensure you’re getting the best returns on your investment. NBFCs usually offer higher interest rates on their FDs than traditional bank FDs.
Tenure Options
Look for fixed deposits that offer flexible tenure options. This means you can align your investment period with your home expenses timeline.
Withdrawal Flexibility
Check the terms and conditions regarding premature withdrawals or partial withdrawals to accommodate any unforeseen financial needs.
Additional Features
Explore additional benefits such as loan against FD, automatic renewal options, and special interest rates for senior citizens, and women if applicable.
Reputation and Trustworthiness
Choose FDs from reputable financial institutions with a track record of stability and reliability for different types of investments.
How Can I Invest in a Fixed Deposit for Home Expenses?
Investing in an FD for home renovations or expenses is a pretty simple process. Here’s a step-by-step process to invest in Shriram FD for your home expenses:
- Step 1Register using your mobile number, pin code, and residency status. Click 'Invest Now'.
- Step 2Choose your desired deposit amount and select your tenure and payout option based on your preferences.
- Step 3Enter your PAN and Aadhaar details, verify via OTP and complete KYC with a quick selfie.
- Step 4Provide occupation details and add your bank details for maturity credit, nominee information and set the maturity instructions.
- Step 5Complete declarations and make payment via net banking, UPI or debit card.
- Step 6Receive instant confirmation via SMS/email and get your digital FD certificate within 7 working days.
How to Withdraw the Matured Amount from a Fixed Deposit for Home Expenses?
Here’s a brief overview of the FD withdrawal process and key pointers to keep in mind:
- While making your FD investment, you will have to choose how you want your FD handled at maturity.
- You can opt to receive the matured amount directly into your linked bank account or also go for auto-renewal to reinvest the amount for another term.
- To receive your matured FD amount automatically to your linked bank account, choose the option "Refund on Maturity."
- This ensures a smooth and automatic transfer of the funds on the due date.
- If you choose to withdraw your FD investment early, a penalty fee will be levied.
- Try to keep your FD investment locked-in to maximise your returns on maturity.
Conclusion
Using a fixed deposit for home renovations and enhancements offers a variety of benefits. With the stability and steady returns of a fixed deposit, you can confidently plan and budget for your projects without worrying about market fluctuations. The interest earned can contribute to funding these improvements, easing financial strain. By using a fixed deposit, you ensure a reliable financial resource that supports the renovation of your home.
FAQs
Can I use the funds from an FD for home expenses for purposes other than home-related expenses?
Yes, you can use the funds from an FD for home expenses for any purpose. The name of the FD does not restrict the use of the funds.
Can I add more funds to my FD for meeting my home expenses after opening it?
No, you cannot add more funds to an existing FD. However, you can open a new FD if you wish to invest additional funds.
How can I open an FD to fund my home expenses?
While you cannot open an FD account for home expenses, you can start an FD to meet your home expenses. You can book Shriram FD through the website or the Shriram One app, making it easier for you to book an FD with us.
Can I make partial withdrawals from my FD for taking care of my home expenses?
No, partial withdrawals are not allowed from an FD for home expenses. You might have to close the FD if you wish to withdraw funds before maturity. Please remember that this will incur penalties.
Are there any age restrictions for opening an FD for home expenses?
There are no specific age restrictions for opening an FD for home expenses. Minors can also open an FD with the help of a parent or guardian.
Disclaimer
With regards to deposit-taking activity of Shriram Finance Limited (’SFL’), viewers may refer to detailed information and T&C provided in our application form available at https://www.shriramfinance.in/downloads. The Company is having a valid Certificate of Registration dated 31st January 2023 issued by the Bank under section 45-IA of the RBI Act. However, the Reserve Bank of India does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.
