A fixed deposit scheme can help you to save a lot of money and can also assist you in expanding your investment portfolio. Hence, it is important that you wisely choose the fixed deposit account and make sure that your money is invested with the right bank or financial institution. By doing so, you can ensure that you get maximum value for your bucks. There are numerous fixed deposit schemes available these days and so choosing the right one can become a daunting task.
Here are a few tips that will help you in choosing the right fixed deposit scheme:
1. Opt for a scheme that offers the best interest rates – You should opt for a scheme that will offer you with the best interest rates so that you can earn more money within a short period of time. If the interest rate offered is on the higher side, you can earn more even if you deposit a comparatively smaller amount of money. However, do not just opt for a scheme just because it offers a higher rate of interest and instead opt for a scheme that also offer other beneficial features along with attractive interest rates.
2. Choose a scheme that offers flexible tenures – The tenure of the scheme should be flexible so that you will not have any problem in choosing a tenure that will be best suited to meet your needs. For example, if a scheme comes with tenures of 6 months to 5 years, you can choose a shorter tenure if you want to save money only for a short period of time and a longer tenure if you are looking to earn more interest from the deposited amount. However, you will not enjoy such flexibility if the scheme does not come with flexible tenures.
3. Opt for a scheme that is covered by deposit insurance policies – The banking and financial sector is very volatile and is susceptible to changes in the global economy. Hence, it is not very certain that the banks and other financial institutions will perform as desired all the times. In case the bank that you deposit your money with faces a financial crisis it may not be able to give you back your money. Hence, it is advisable that you opt for a deposit scheme that is covered by deposit insurance policies so that you can be certain that you will get you money back.
4. Select a scheme that comes with very low fees and charges – The fees and charges associated with the fixed deposit scheme that you opt for should be very low so that you will not lose a huge percentage of the amount that you deposit in paying various fees and charges. Make sure that you opt for a scheme that comes with very low fees for premature withdrawal of the deposited amount so that you will not have to be in a lot of trouble in case you decide to withdraw the deposited amount before the end of the chosen tenure.
5. Choose a scheme that comes with the option of auto renewal – It is better that you choose a fixed deposit scheme that comes with the option of auto renewal at the end of the tenure. If you do so, you will not have to go through the hassle of visiting the bank or contacting their customer support team to get the deposit scheme renewed. Instead, it will be renewed automatically at the end of the tenure based on the standing instructions that you provide when you sign up for the deposit scheme offered by the bank.