Top 5 Reasons Why Millennials Should Consider Investing in FDs
As millennials enter the workforce amid volatile financial markets, they seek conservative investment options. The main objective of financial planning is to build an emergency fund, which can take care of your expenses in case of an unforeseen circumstance.
Fixed deposits (FDs) have been quite a popular investment avenue in India. You can invest a certain amount for a particular duration at a fixed rate of interest. Banks and non-banking financial companies offer such deposits.
Here are five reasons why millennials should consider investing in FDs:
- Assured returns
When you start saving, having guaranteed returns will help you build wealth over the long term. When you open the FD, the interest rate is pre-set. Moreover, any changes in the market conditions do not affect the returns.
- Higher interest
When compared to a savings account, the FD interest rates are more. This allows you to earn better returns on your money without any risks. You can opt for a periodic payout of the interest while your capital continues earning returns. The regular payout is beneficial if you want to supplement your income to meet additional expenses.
- Possibility to avail of a loan against FD
Many millennials apply for loans to buy their first car or purchase the latest gadget. Most financial institutions let you borrow a certain amount against your FD, which is a quick and easy way to take a loan.
- Ability to withstand financial volatility
Financial markets are volatile, and you cannot predict when an adverse situation can impact your returns on investments. As the FD rates are pre-determined, your investment is protected against such uncertainty.
- Compounding returns
The interest in your Fixed Deposit is compounded. So, you earn extra interest on your original return. In other words, the first-year interest gets added to your FD amount, allowing you to earn greater returns in the second year. This compounding enables you to grow your wealth in the long run.
You can open an FD with a reputed financial institution like Mahindra Finance. You can visit the issuer’s website to know about the interest rates, FD documents required, different tenures available, and other terms and conditions.
The process to open an FD is simple. You can do it online without any hassle. Mahindra Finance needs minimal fixed deposit documents. So, the entire procedure concludes without any delay. Visit the financial institution’s website now and invest in an FD.