Tips to be followed while going for fixed deposits | How to opt for fixed deposits for better results and convenience?

September 10th, 2010| Finance.

Tips to be followed while going for fixed deposits | How to opt for fixed deposits for better results and convenience?

Fixed deposits

According to the changing situations, banks are competing with each other to increase the fixed deposit rates.  Now people are finding it difficult to decide where to deposit the money.   Generally Banks which give more interest are selected.  There is also confusion between selecting a Private Bank and a Government Bank. It is to be remembered that deposits below Rs.1,00,000 are insured with Deposit Insurance and Credit Guarantee Corporation.  So money up to that limit will be safe with any bank.  Not only that, Indian Banking system is now very strong and is developing with strong regulatory authority.  So there is a guarantee for the money of the depositors.  It need not be stressed that the money in Government banks is very secure.  Also there is not much difference in the interest rates of Private Banks and Government banks.  So it is better to choose a bank which offers high interest rates, customer services and online services with latest technology.  If the investment amount is more, it is better to invest in more than one bank and the deposits should be divided into small amounts.  For example, if Rs.10,00,000 is to be deposited,  make deposits of Rs.1,00,000 each.  In this way it would be easier to withdraw money before the time limit when the need arises.

Fixed deposits should be taken not on a single name but on joint names of one or two family members.  Take the certification from the Bank when nomination facility is utilized.

The receipts of the deposits should be safely kept in lockers.  Banks issue duplicate receipts if the original once are misplaced.  Deposit receipts and deposit numbers should be kept safely in written form.

Make it clear to the bank whether to extend the term of the deposit or to transfer the deposit into other saving schemes.  Loans can be taken on the deposits before the time limit of the deposit.  So it is better to avail the loan facility than to cancel the deposits before they are matured.

Submit 15 H or 15 G forms to the bank to get tax exemption for the income got in the form of interests on deposits.

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