Fixed deposits are quite safe and convenient, but have a host of benefits that are rarely advertised or understood. Earn more than a savings account with an FD with features such as FD-linked credit card.

From the time you earned your first rupee, you must have heard well-meaning relatives extol the virtue of saving for a rainy day. Financial experts and planners also suggest that saving is essential for every individual, and one of the safest known financial saving instruments is Fixed Deposits. Popularly referred to as FD, it is available with nearly all financial institutions. However, many young people tend to think of the FD as not exciting enough and an investment for the seniors.

Though it may lack the adrenaline-pumping effects of a share market, the financial instrument brings in a fixed income. Investors have to check the various rates of interest offered before finalising on a bank that meets their risk appetite and financial goals.

Let’s Look At Some of the Major 5 Benefits Of FD

Flexible tenure – Did you know that every fixed deposit period is not five years long? The fixed deposit period can vary from a week to 10 years. Who would want an FD for a week? People who have cash which they need to meet an expenditure planned for the coming week. Even a corporate house, take advantage of the returns – imagine an amount of Rs. One hundred crores available in cash – why not earn up to Rs 30-40 lakhs (interest on fixed deposit varies) in the week with the FD. 

Assured returns – Which financial instrument can assure you of a fixed return on your investment? Savings invested in public sector banks are more or less assured since they are safe players and will not take unnecessary risks. Additionally, they are backed by the government and hence, the payouts are safe. You do not need to worry about putting your savings in a public sector bank. Whatever your age or risk appetite, you need to deposit a fixed amount in safe financial instruments.

Choose the Frequency of payment – You choose how often you get paid. It may be monthly, quarterly, or annually. So, for a person out of a job or retired, monthly payout means of survival. It is also possible to choose a cumulative FD where the interest earned is reinvested back into the principal. It means more passive income for you from interest on fixed deposit.

Take a loan against fixed deposit – It is really easy to ask the bank for a loan against fixed deposit. You can get up to 85% of the amount deposited with the bank as a loan amount. For young people, looking to invest in bigger and better things, the interest rate is low, and paperwork minimum.

Avail credit card at cheap rates – Almost all FD investment plans allow you to avail low-interest rate credit cards. The yearly fees depend on the card and can vary between Rs. 500 to 1,000.

In return, you get a card with minimum verification and credit limit from two to five lakhs. You can use the card for foreign currency transaction. If you are traveling abroad.


Fixed deposit may be a traditional savings instrument, but it is a nifty investment tool. It is probably the only type of investment in the country used equally by people belonging to every stratum of society. With the rising popularity of internet banking, it is possible to buy fixed deposits online and through apps without even having to visit a branch.