3 Lesser known Reasons Why You need a Fixed Deposit

What is the fuss?

Fixed Deposit (FD) is a boring way of investing your money. FD provides a fixed interest rate on the principal amount you invest. The investment is for a fixed period, starting from 1 year to 5 years or more. Fixed interest rates, and fixed tenure of investment is probably why ‘Fixed Deposit’ get its name. The fixed parts definitely give FDs a boring air around them.

FDs, in recent years, have received less love from social media influencers. The broader message circulating is that FDs do not even beat inflation, and hence reduce your wealth over time. Well, part of this is not true. In this post I will tell you three lesser known reasons why you need a Fixed Deposit as a part of your investment portfolio. Lets get started, bust some myths, and know some interesting facts & uses of FDs.

Why is there negative sentiment around FDs?

The main reason behind negative sentiment surrounding FDs is inflation. Beating inflation is essential. If not done, your wealth will reduce over time.

Now, gains made from FDs are fully taxed as per your income tax bracket. These taxes decrease the net gains made by the investor. Unlike equity investment, where long term capital gains tax rate is just 10%, gains made from…