How to Earn More Money from Fixed Deposits

Fixed deposits are instruments through which you earn interest by depositing a lump-sum amount with a financial institution for a selected tenor. The rate of interest you get on an FD is generally higher than what you earn on a savings deposit. 

 

Additionally, stable returns make this savings tool much safer than investing in market-linked options. If you have surplus funds that you want to invest securely and risk-freely, you can go with FDs offering high interest rates. 

 

Read on to learn about how to earn more from a fixed deposit and make the most of your savings.

While a fixed deposit itself guarantees stable returns over its tenor, there are several ways in which you can earn more lucrative returns. Here are the steps on how you can get the maximum benefit from booking a fixed deposit:

• Start your Fixed Deposit Online 

Opening a fixed deposit online allows you to browse multiple options and choose the issuer offering the highest interest rates. Higher interest rates translate into higher returns. 

 

Additionally, you can also see how the interest rates vary for different deposit amounts and tenors. By comparing all these options online, you can plan your investment to maximise your returns. 

• Opt for Cumulative Fixed Deposits

While a non-cumulative fixed deposit ensures regular payouts, a cumulative fixed deposit ensures a bigger payout upon maturity. 

 

With a cumulative fixed deposit, you can build a bigger corpus since the interest earnings are reinvested along with your principal. In other words, you get the benefit of compounding, which increases your earnings.

• Do Not Close your Fixed Deposit Prematurely 

In fixed deposits, your deposit amount stays with the financial institution for a fixed tenor. Withdrawing from your fixed deposit before the tenor ends can result in a penalty levied by the institution. 

 

This will deplete the amount you stand to earn at the end of the tenor of your fixed deposit. It will also prevent you from earning optimal returns on your deposit. To earn the most out of your deposit, stay locked-in for the tenor.

• Start Fixed Deposits in your Parents’ Names

If your parents are senior citizens, you can start a fixed deposit in their name and earn higher interest rates. Most banks and NBFCs offer a higher rate to senior citizens as compared to regular citizens.

 

Booking a senior citizen FD on Bajaj Markets allows you to enjoy interest rate hikes of up to 0.25% as compared to base rates. 

• Pick Tax-Saving Fixed Deposits

There are several kinds of fixed deposits available to depositors. While some allow for tax savings, others do not. So, thoroughly browse through the options available to you before you book a fixed deposit. 

 

Try to pick a fixed deposit that earns you the highest tax-saving benefits. However, remember that tax-saving FDs have a lock-in period of 5 years. Also, compare the returns of a tax-saver FD with a regular FD to secure the best returns. 

• Select a High Rate of Interest

Different financial institutions offer fixed deposits at varied rates of interest depending on the tenor. So, when choosing a lender and preferable tenor, look for where you can earn higher returns. 

 

Sometimes, FD issuers have special tenors that come with a higher interest rate. Signing up for these can also help you augment your earnings. 

 

To determine your returns and compare them based on different FD interest rates, you can use an FD calculator. Based on the results, you can choose a lender that offers the best returns. 

• Investment in Multiple Fixed Deposits

Parking your funds in more than one fixed deposit pays in different ways. The benefits of adopting the practice of laddering include the following:

 

1. It lets you enjoy varying interest rates at different times 

2. It acts as a safety net helping you diversify a risky portfolio focused on market-linked investments

3. It helps in reducing your tax liabilities

4. With varying maturity periods, you can enjoy better liquidity 

 

Starting a fixed deposit account on Bajaj Markets is easy and open to all Indian citizens residing in the country. In fact, a Hindu Undivided Family, sole proprietors, partnership firms, companies, clubs, societies, associations, and family trusts can also consider an FD. 

 

The only documents required include your latest photograph and KYC documents. While this sounds simple enough, opening the fixed deposit is easier still as it can be done in a few simple steps on Bajaj Markets. 

 

Here is how you can start your FD journey and secure your future today!

• Step 1: Enter your mobile number and date of birth and verify the OTP to continue

• Step 2: Fill in the deposit amount, the tenor, and the interest payout type, as well as your bank account details

• Step 3: If you are an existing customer, just need the nominee details to continue

• Step 4: If you are a new customer, complete your KYC by submitting your PAN or Aadhaar details or by simply uploading the documents required

• Step 5: Make the payment for your initial deposit using internet banking/UPI; the latter is not available if you are depositing over ₹1 Lakh

• Step 6: Once the payment is successful, your deposit will be created  

 

An acknowledgement for successfully opening the FD account will be sent to your mobile number and your email ID. After this, you can keep track of your returns from anywhere at any time via the issuer’s app.