Saving and investing your hard-earned money is crucial today. We have conventionally been taught that money can be saved in savings bank account and conventional instruments like bank FDs. However, bank FDs offer low rates of returns (typically 2.50% to 6%). Currently, bank FD interest rates are almost the same as savings bank account interest rates.
With changing times, newer options are available now to invest.
Let’s take a look to know if they fare well against conventional methods of investment. You may want to start with the safest and highest-yielding FD option.
- Shriram Fixed Deposit
With Shriram Fixed Deposit, the conventional image of FDs gets a new narrative. You can earn interest rates of up to 9.10%p.a. You have the flexibility to choose a tenure between 12 months and 60 months. If you are a senior citizen, you earn an additional interest rate of 0.50% p.a. Women depositors get an additional 0.10%*p.a. Depositors also get flexible interest payout options: monthly, quarterly, half-yearly, yearly or at maturity. The best part of investing in Shriram Unnati Fixed Deposit is that they come with a high degree of safety as they are accredited with “[ICRA]AA+ (Stable)” by ICRA and “IND AA+/Stable” by India Ratings and Research.
You can calculate your returns on your investment by using Shriram Fixed Deposit Interest Calculator.
Interest Rates: By investing in a non-cumulative FD plan, investors can earn higher interest rates of up to 9.10%*p.a. Need more information on interest rates? Click here.
Process: Here’s how you can apply for Shriram Fixed Deposit:
a. Register using your mobile number.
b. Input PAN details and investment amount and tenure.
c. Complete KYC and enter your details to complete your payment.
d. Get the fixed deposit receipt and maximize your returns.
Tenure: Investors can personalize their investment plans by choosing to invest in tenures ranging from 12 to 60 months.
- Post Office National Savings Monthly Income Account (POMIS)
POMIS is one of the safest yet high return-yielding (7.1% interest rate) schemes. The returns from this scheme are disbursed monthly. It is recognized and validated by the Ministry of Finance.
Let’s have a look at some of the features of this scheme:
Interest Rates: The interest rates for this scheme are set at 7.1%. The returns are debited monthly.
Maximum Deposit Amount: The maximum investment limit in this plan is ₹9 lakhs. The cap for joint accounts is ₹4.50 lakhs. In case of multiple post office accounts, the cumulative amount can’t exceed the value of ₹15lakhs. For minor accounts, the maximum deposit limit tends to be different.
Process: The process for investing in POMIS is easy and enrolment-friendly. The mandatory condition for investing in this scheme is to have a Post Office Savings Account. You must comply with the following process:
- Collect a POMIS form from your nearest post office.
- Submit the form along with the required documents:
a) Photocopy of ID Proof
b) Photocopy of Address Proof
c) 2 passport-size photographs
- Gather the signatures of beneficiaries and witnesses.
You can start by submitting a dated cheque along with these documents. The date mentioned in the cheque is the day that will be counted for the opening of the account.
Taxes: There are tax benefits under Section 80C. However, the interest amount does not incur any tax deduction at source (TDS).
Tenure: The total tenure to stay invested in the scheme is 5 years.
- Equity
One of the most attractive options for retail investors is investing in equity. Lucrative returns and a promising Indian economy have made it a viable option for younger investors. However, there are challenges to enter the markets, including a higher knowledge base, prior experience in investing and an eye for predicting dynamic changes. Thus, equity investments—despite the return rates—have an equally good chance of limiting your returns and sometimes even putting your hard-earned principal at stake.
Interest Rates: Equities are directly linked to market fluctuations, with no assurance of return on investment. Equity returns are dependent on the performance of the asset in the context of the market.
Maximum Deposit Amount: The Income Tax Department is highly vigilant against high-value transactions. Even if the cash transactions are undisclosed, the Department can take notice of details from the balance sheet of the institution under which the bank transaction has been done. Many investment experts have advised not to cross the ₹10 lakh limit in mutual funds and equity investments. If the Income Tax Return (ITR) of the investor allows investment beyond this limit, then you can use digital payments.
Process: The process for investing in equities:
- Fill out the online form for opening a free Demat account with your broker. Enter important details including your mobile number and email ID in the form.
- Share your PAN card and bank details in the form.
- Complete your e-KYC details and get your identity verified for opening the Demat account.
Taxes: Equities are taxed at a percentage rate that is dependent upon the holding period of the investors in those stocks. If the holding period of the stock is less than 12 months, and there are short-term gains in the stock, then this may incur a short-term capital gain tax of 15%.
When the holding period is over 12 months, a long-term capital gain is incurred, which is set at a rate of 10%.
Tenure: You can hold the equities based on your understanding and goals. There is no set limit on the time that you need to be invested in.
Last but not least
Now that you understand which investments give better financial returns than bank fixed deposits, go ahead and start investing. Low interest returns from bank fixed deposits have made them unattractive to investors. Booking a corporate fixed deposit like Shriram Fixed Deposit can help you earn attractive returns on your investments. Invest now and start earning attractive and assured returns.
Investment Plans FAQs
1) Which is the right financial instrument for you to begin investing in?
You must understand your risk appetite and investment goals to determine the right financial instrument for yourself.
2) What is the right time to start investing?
With Shriram Fixed Deposit which helps you invest in a few clicks and earn a higher ROI, the right time to begin investing is now.
3) Is It safe to invest with your money?
It is safe to invest if you can put your money in plans that have safeguarding setups like being backed by the Government, higher credit ratings and the like.
Key Highlights
• The best instrument for investing is by finding the most appropriate tool based on your return and risk appetite. Due diligence is required to know the most appropriate option.
• The process of investing in any kind of instrument might take some time. It is important to understand the process before you begin investing.
• Corporate fixed deposits yield better interest rates than bank fixed deposits.
• Shriram Fixed Deposits are a great way to get higher rates of returns.
