Fixed Deposits
Guaranteed returns, zero risk
What is it?
A Fixed Deposit (FD) is a bank product where you lock a sum for a fixed period at a pre-decided interest rate. Your principal is safe, and returns are guaranteed.
FDs are insured up to ₹5 lakh per bank under DICGC.
How does it work?
- Deposit a lump sum with your bank (min ₹1,000 typically)
- Choose tenure — 7 days to 10 years
- Earn fixed interest — Rate locked at time of deposit
- Get money back at maturity — Or break early with a penalty (0.5-1%)
Interest can be paid monthly/quarterly (for income) or reinvested (for growth).
Who should invest?
- Emergency fund: Park 3-6 months' expenses in FD ladders
- Short-term goals: Money needed in 1-3 years
- Conservative investors: Those who can't stomach market volatility
- Senior citizens: Get 0.25-0.5% extra interest
Not ideal for: Long-term wealth building (returns barely beat inflation after tax).
Tax treatment
- Interest is fully taxable at your income tax slab rate
- TDS of 10% if annual interest exceeds ₹40,000 (₹50,000 for seniors)
- Tax-saver FD: 5-year lock-in, ₹1.5L deduction under 80C
Pro tip: If your total income is below ₹5L, submit Form 15G/15H to avoid TDS.
How to start?
- Open an FD through your bank's app or net banking
- Compare rates across banks (small finance banks often offer 1-2% more)
- Consider FD laddering — split into multiple FDs with staggered maturity dates
- Auto-renew for convenience, but review rates at maturity
Ask Corpus about your savings
Not sure if FDs are the right choice for your goals? Ask Corpus for a personalized recommendation.
Ask Corpus →Disclaimer: This is educational content, not investment advice. Returns and tax rules are indicative and subject to change. Consult a SEBI-registered advisor for personalized guidance.