When you decide to grow your savings by investment, you can either opt for long-term investment plans or short-term investment plans. Short-term plans include savings account, Recurring Deposit (RD), debt mutual funds, etc. Long-term plans include the Public Provident Fund (PPF), Employees’ Provident Fund (EPF), equity shares, etc.

Fixed Deposit (FD) is the investment plan that can be both short-term as well as long-term. Conventional banks allow FDs for a tenor of as low as 7 days to up to 10 years. You can choose to invest in an FD as per your financial goals and as per your convenience.

Earn Monthly Return on FD

Fixed Deposit (FD) is India’s most reliable and secure investment instrument. You can assure guaranteed returns from your investment. The returns gained from FDs are higher than the standard savings account. Today, leading Non-Banking Financial Company, Bajaj Finance offers the highest FD interest rates in India ranging from 8.75% to 9.10%. You need to deposit a sum as low as Rs. 25000 for a flexible tenor of 12 months to 60 months. You get to select from two types of FDs, they are:

Cumulative FD

In a cumulative FD, the interest is compounded on a quarterly or a yearly basis. The FD interest rates are paid at the time of maturity with this type of FD. Cumulative FDs aid in building a sizeable corpus and receive them in a lump sum.

Non-Cumulative FD

In a non-cumulative FD, the interest is paid out monthly, quarterly, bi-annually, or annually as per your preference. Non-cumulative FDs aid in earning interest payouts for fulfilling the regular expenses. Pensioners who seek regular income can opt for non-cumulative FD to meet their daily requirements.

Both cumulative and non-cumulative FD offers high interest rates than a regular savings account. However, you can earn high returns from a cumulative FD than a non-cumulative FD. If you want regular income from your FD investment, you can consider investing in non-cumulative FD and choose the interest payout frequency monthly. Also, you can choose to ladder your FD and maintain liquidity from your investment.

What is FD Laddering?

Unlike other investment options, you can open multiple FDs at the same time from the same financial provider or different financial providers. If you choose different tenors for different FDs, you can receive the returns along with the FD interest rates after the maturity of each FD as per your tenor selection.

For instance, if you have invested in 4 FDs simultaneously with 1 year, 2 years, 3 years, and 4 years respectively, you will receive your returns after 1 year, 2 years, 3 years, and 4 years respectively. With FD laddering, you would be able to eliminate the risk of premature withdrawals. If you make premature withdrawals, you will need to pay a fixed penalty charge and will not be able to enjoy the comprehensive benefits from the investment.

Why Should You Choose Monthly Interest FD Plans?

There are many investment options available in India that offer monthly interest returns. However, FD is known to give the highest interest rate compared to all other investment options. Bajaj Finance offers FD interest rates ranging from 8.75% to 9.10% which is the highest rate among all other financial providers.

With Bajaj Finance, you can apply for an FD with a quick application form. All you got to do is to provide the type of customer you are from existing, new, and senior citizen customer. You need to choose the type of FD from cumulative and non-cumulative next. If you have selected non-cumulative, you need to choose the frequency of interest payout, the deposit amount, and the desired tenor. Additionally, you can calculate the FD returns and the interest rates by the online FD calculator.

Author Bio: Aman is working in the domain of Investment management in one of the top universities. He has published research papers and case studies in Investment and Fixed Deposit (FD) marketplace. He is an avid blogger in the domain of Investment management. you can also find him on social networking platforms.

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