Fixed deposits have been a part of each Indian household for a decade now. The present times, however, are observing a slide down in fixed deposits with mark changes towards various other investments.
There was a time when everyone saved a part of his/her income and invested it in FDs to earn some extra income in form of interest. Our parents have all ended up depositing their money in FDs at least once in their lifetime.
Poor Interest rates on fixed deposits have been a major source of worrisome for investors, especially for senior citizens who mainly rely on them for regular income. The Interest rates on FDs are lowering year by year simultaneously there is a hike in inflation rates, investing in FDs a poor choice.
But there is no reason to be disappointed, there are some investment schemes where you can get higher returns than bank FDs and sustain your money for a longer period.
1.Immediate Annuity Plan Returns:
An immediate annuity is the most primary type of annuity. You can make a one-time lump-sum contribution. It’s converted into an ongoing, guaranteed stream of income for a specified period of times (probably for 5 years) or a lifetime. Withdrawals may begin within the first year only. It’s a tax-deferred status that allows you to gains from the compounded growth.
2. Post Office Monthly Income Scheme Account:
With an initial deposit of Rs 1500 up to a limit of Rs 4.5 lakh for an individual bearer and Rs 9 lakh for joint bearers, the post office monthly income scheme comes with a term of a minimum of 5 years (Lock-in-Period). POMIS promises a monthly interest rate of 7.6% as of now.
3. RBI Floating Rate Savings Bonds:
RBI Savings Bond have a maturity of 7 years. The interest rate for the period July 1 to Dec 31, 2020, is 7.15% which will be payable on Jan 1 next year. The interest rate on RBI Floating Bonds will be revalued every 6 months. An investor can invest in bonds for a minimum amt. of Rs1,000. There is no maximum limit. These bonds offer a special early withdrawal facility to senior citizens(age 60).
4. National Pension System (NPS):
Opening of individual Pension Account under NPS by all Indians including NRIs between 18-65 years in both Tier 1and Tier 1&2. It is optional, simple, portable to open an account that is regulated by PFRDA. With a current rate of interest of 9%-12%, this is one of the most gainful options of investments for individuals who want to create a financial cushion in a long term.
5. National Savings Certificate:
National Savings Certificate, is an investment scheme backed by the government of India. This savings bond is worthy for small and medium-income investors to save tax while earning returns. As it can be started with minimum deposits of Rs.100 and comes with a maturity period of 5 years. The certificates provide a fixed rate of interest of 6.8% per annum.