COVID-19 has knocked our doors, loud and strong and to fight it, all we need to do is stay put. But, what about our money? Does it need to stay put too? Or should it be locked safely in bank deposits? In such times, a mix & match is what will give the optimum results. Let us see how.
For risk-averse investors as well as the risk-lovers, fixed deposits or term deposits (as called in banking parlance) help strike the right balance in their investment portfolios. However, the times are different and such desperate times call for desperate measures. Right now, the main concern for most of us is to keep a good amount of cash handy. The economy is suffering a major hit due to the novel coronavirus and many are facing the consequences of it in the form of lack of resources and illiquidity.
Is it safe to invest in Indusind Bank FD @ 7% when all other banks are in the region of 5%?
IndusInd Bank is listed as a scheduled bank under the RBI and deposits up to Rs 5 lakh are covered by the DICGC (a wholly-owned subsidiary of RBI).
A 5 lakh cover by DICGC is applicable also to Company fixed deposits?
DICGC deposit insurance of up to Rs 5 lakh is only for deposits made in a bank (commercial banks as well as small finance banks). The company fixed deposits are not covered under DICGC insurance.
Ma’m i m 45 yr retire fm army. What should i do with my money. Where i invest now this situation.
Due to the unstable economy, the prime motive should be the security of your hard-earned money. Being said that, it is always better to keep a good mix of return-inducing and safety-backed investments in your portfolio. Therefore, consider maintaining a balance between options like fixed deposits and mutual funds. FD will offer security and returns at fixed interest rates. Mutual funds will give exposure to the market-linked returns. The market is touching new lows these days and ironically, it the best time to invest in mutual funds since the MF values are significantly low. However, to reap maximum benefits, you will need to stay invested in MF for 3-5 years. Check these articles to better understand: FD or MF – What’s Better for Me? and Best FD Rates in 2020
How is Sundaram Fixed Deposits. I have some FD with them for the last 5 months. Can I close the FD right now. Please advise.
Sundaram Finance is giving good returns as compared to big commercial banks. The bank is scheduled under RBI listing and thus, in case of a default, you will be entitled to a compensation of Rs. 5 lakh by DICGC. Hence, it is a good thing you have an FD with the NBFC.
However, if you need cash owing to Covid crisis, you may withdraw your FD prematurely now. But do so only if it’s absolutely required because the interest rates might not go up for some time.