Why are Fixed Deposits a must-have in your investment portfolio?

Making suitable investments is the key to financial success and stability. You deposit your money in an investment instrument, which assists in wealth creation. Investments help you achieve various goals, lead a better lifestyle, and secure the future of you and your loved ones. Hence, you should actively invest. When investing, aim to create a diverse portfolio, as this is beneficial in several ways.

There are different investment instruments you can add to your portfolio. Fixed Deposits or FDshould be strongly considered. It is simple and profitable. Let us understand the reasons why you should add FDs to your portfolio:

Surety of returns

When you make any investment, you do it with the expectation of earning reasonable returns. FDs are asecure investment instrument that assures surety of returns. It earns you returns based on an interest rate. If you want to determine your investment returns, FD calculator is a fantastic online tool to rely on. It gives an estimate of your investment's maturity value by entering key variables. You will get accurate results soon.

You can find the FD calculator readily on any leading bank's website or the Banking App. You can use the FD calculator innumerable times, free of charge.

Flexible options

You can invest in FDfor a flexible tenure between seven days to 10 years. This means you can invest in FDs to meet any financial goal, whethershort-term, mid-term, or long-term. Furthermore, there are two types of FDs:Cumulative and Non-Cumulative. With the Cumulative Deposit, your interest earnings are added to your principal sum. You can benefit from the power of compounding and reap better returns in the long run.

With Non-CumulativeDeposits, you receive your interest earnings periodically. You can utilise these interest earnings to meet various expenses. You should add both deposits to your portfolio to benefit from both periodic and lumpsum pay-outs.

Balances risk

Taking on risk is inevitable when creating an investment portfolio. However, adding Fixed Deposit to your portfolio balances the associated risk. This is because FDs are a secure investment instrument and are nowhere linked to market volatility. This ensures you do not risk your principal investment sum and earn reasonable, guaranteed returns.

Facilitates Loan availment

Financial requirements are bound to come up. Naturally, you would turn to your savings and investments to fulfil your requirements. However, doing so can disturb your financial plans. FDs offer a great alternative here. You can apply for a Loan against FD. You can pledge your Fixed Deposit Account as collateral and avail up to 95% of the deposit value as a Loan.

You can quickly repay the obtained Loan in Equated Monthly Instalments. This way, you meet your financial requirement hassle-free and stay focused on your goals.