Fixed Deposit: There are many mediums of investment, where better returns can be achieved. However, many people want to keep their capital safe and earn returns on it. In such a situation, people also move towards FD (Fixed Deposit).
There are many avenues to invest, where better returns can be achieved. However, many people want to keep their capital safe and earn returns on it. In such a situation, people also move towards FD (Fixed Deposit). Through FD, people are able to keep their capital safe and also get returns on it at a fixed rate of interest. But if you make a mistake after getting the FD done, then you may have to pay a fine.
FD is one of the safest investment options in the country as it is risk free and guarantees returns. It is an investment in which the customer deposits a fixed amount in an account for a specified period and earns interest on it.
The amount deposited in FD is locked. This lock-in period is chosen only by the person who is getting the FD done. However, it has been seen many times that FDs are broken before maturity.
When people get FD done, it has also been seen many times that people suddenly need money. In such a situation, people break the FD without thinking anything. However, if the FD is broken before maturity and money is withdrawn from it, then there is a penalty.
Premature withdrawal can also be done from FD, but in such a situation, the person has to pay a penalty. Due to which the amount of interest earned on FD also gets affected.
On the other hand, if people withdraw money by prematurely closing the FD, then most banks levy a charge on it and a penalty between 0.5% and 1.00% of the interest rate is levied as a penalty.
