Individuals who want peaceful sleep with their investments, always look for products with guaranteed returns. And for such people, there are multiple instruments such as recurring deposit, sukanya samriddhi yojana, and national pension scheme and few others. Each of these products has a limitation of fixed tenure which is normally in months/years. However there is one investment product – fixed deposit, which scores over others in terms of the flexible tenure which can be as low as 7 days to maximum of 10 years along with fixed interest rate and any amount can be deposited, although there is a minimum sum requirement by every financial institutions. Moreover the interest is paid every month or annually. And you can have multiple FD accounts. Listed in the below table is the maturity value calculated by FD for 6 months:

Name of Bank	6 Months Interest Rate %	Interest Earned On 5 Lakh FD (Rs.)	Maturity Value On 5 Lakh FD Compounded Quarterly (Rs.)	Interest Earned On 2 Lakh FD (Rs.)	Maturity Value On 2 Lakh FD Compounded Quarterly (Rs.)
UCO Bank, Corporation Bank, Standard Chartered Bank	6.5	16382	516382	6552	206552
Union Bank of India, Axis Bank, Indus Ind Bank, ICICI Bank, HSBC	6.25	15747	515747	6298	206298
Dena Bank, Kotak Bank, Punjab and Sind Bank	6	15112	515112	6045	206045
Deutsche Bank	5.7	14351	514351	5740	205740
Canara Bank, Syndicate Bank	5.5	13844	513844	5537	205537
Indian Bank	5.25	13211	513211	5284	205284
Citi Bank, Indian Overseas Bank	5	12578	512578	5031	205031
Royal Bank of Scotland	4.9	11313	511313	4525	204525

Point to remember: Interest rates are subject to change. You can get updated rates either on bank’s website or by personally visiting the bank. Check out fixed deposit for 5 years and the maturity amount.

Disadvantages of fixed deposit:

Every investment has pros and cons. And FD too has its own set of limitations as follows:

• Returns are low due to low interest rates offered.
• Money gets blocked and premature withdrawal results in penalty.
• Interest income is taxable. TDS is applicable on the interest accrued.

Author Bio:

Hi, I am Nikesh Mehta owner and writer of this site.

I’m an analytics professional and also love writing on finance and related industry. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business.

I can be reached at nikeshmehta@allonmoney.com. You may also visit my LinkedIn profile.