With the RBI slashing the repo rate for the first time in 5 years, many banks, including public sector ones, have revised their interest rates on fixed deposits (FDs). FD customers, especially senior citizens, have enjoyed high interest rates on their FD investments for the past many years amid a high interest regime in the country. But since banks have started revising downwards their FD rates, many investors would be now thinking about exploring other investment avenues to get better returns.
If you are looking for better returns than fixed deposits (FDs), then you have many great options. FD gives security and fixed interest, but its interest rates often fail to beat inflation. This is why investors now need such options that give better returns and also keep the risk balanced.
In this story, we will explore 7 best options of FDs, which are divided according to your risk-taking capacity. Whether you want a completely safe investment or are ready to earn more returns by taking a little risk, this write-up will guide and help you make the right decision.
Also read: Stock market crash: Rs 94 lakh crore gone! What should mutual fund investors do now?
1 Savings accounts in small finance banks
If you want to get better interest rates than FDs and maintain full liquidity, then savings accounts in small finance banks can be a good option. These banks offer interest up to 7%, which is much higher than traditional banks.
Benefits:
-Better interest rates (up to 7%) than FDs
-Instant access to funds (no lock-in)
-Insurance protection up to Rs 5 lakh (by DICGC)
Disadvantages:
-Interest rates may change from time to time
-Some banks have a minimum balance requirement
-Can be difficult to beat inflation
2 Post Office Savings Schemes
If you want complete safety and government guarantee, then post office NSC (National Savings Certificate) and PPF (Public Provident Fund) can be the best options.
Benefits:
-Safe investment with government guarantee
-Tax savings under Section 80C
-Higher returns due to compounding benefits
Disadvantages:
-Long lock-in period (PPF – 15 years, NSC – 5 years)
-Interest rates may change every quarter
-Not all schemes can fight inflation
3 Government Bonds and RBI Bonds
If you want better interest than FD with complete safety,
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