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Investments are a popular financial instrument in India. Many families consider it wise to start saving for any financial emergencies in the future. Since it has a massive population and diverse citizens, many investment options are available with different schemes and tenures. They offer guaranteed returns and induce the habit of saving in many individuals. Whether they are teenagers, adults, or even senior citizens, they can always approach their bank’s nearest branch and enrol for an account.
A recurring deposit is a low-risk investment tool with assured returns and a flexible tenure for customers to invest without any hassles. They can choose the amount to invest based on their capacity and see it multiply and receive interest throughout the deposit tenure. This investment tool is available at all banks and NBFCs to channelise monthly savings for long- and short-term corpus creation ranging from six months to 10 years. Investors must choose the minimum monthly deposit amount over the term for assured wealth generation. An RD account facility is available at post offices as well. While the minimum deposit amount may vary from institutions, investors can start depositing an amount as low as INR 100 per month as per their budget. However, consider choosing a scheme that allows a suitable investment amount according to the capacity and provides a maturity option suiting the investor’s long-term and short-term goals. A recurring deposit account offers many benefits to investors. It helps in the accumulation of capital to meet financial goals and is a smart investment option. It also enables them to earn fixed interest on the amount invested at frequent intervals until maturity. The following are the features it offers: Minimum investment: The minimum investment amount for this account varies from banks and financial institutions. It is safer to check the terms and conditions of the concerned bank to avoid any trouble in the future. Deposit term: The minimum deposit tenure for this account is six months and can exceed up to 10 years. There is a lot of flexibility when choosing the investment tenure according to the financial status and other priorities. Interest rate: Banks mention the rate of interest offered on these accounts in detail on the banking app or website. The individual will always earn a higher interest rate on these accounts as compared to a regular savings account. The interest rate offered on them is like that of fixed deposit accounts. However, the periodic investment instead of lumpsum amount makes it suitable to create a corpus through monthly savings. Withdrawal procedure: While applying for an RD online, individuals must remember that they can withdraw the amount only after the account reaches maturity. Those who are trying to withdraw it before the maturity period must pay premature penalty charges.
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People in India love saving and investing money in different financial instruments. They believe it is essential to save some money for the future if there are emergencies or immediate funding requirements. They prefer investing in assets and derivatives that provide decent returns and are fruitful for achieving their investment goals. Each investor has a different financial capacity; hence their requirements and objectives will also vary.
People invest in an FD as they believe it is safe and offers guaranteed returns. They have different investment options and flexible tenures. They can choose their desired investment options and term depending upon their financial abilities and monetary requirements. The following are some tips to select the appropriate option for investment:
A bank FD offers security and helps individuals understand the value of saving money. It is also easy to withdraw the same, but premature withdrawal attracts penalty charges. Following are the advantages of investing in this financial product:
Investment banking has a significant effect on the world in which you work, whether you have investments or not, and it is essential to understand what investment bankers do. One of the functions of investment banking has to do with acquisitions and mergers, such as why corporations purchase and what is in it for other businesses. Often, even individuals who are not big on investing get the desire to be part of an initial public offering, more generally referred to as an IPO.
If you are dancing in your head with visions of yachts and Bentleys, we will disappoint you with those fantasies, while letting you know what it means to get in on an IPO. Investment banking is a huge mystery for most people; they know it is essential, but they are not sure why. There is no confusion about what conventional banking is, on the other hand. At some point, just about everyone with a savings account has walked into a bank and looked around. Yet, investment banking services are another matter altogether. Projects undertaken by investment banks frequently come into one of many categories, including:
You start making your income in the currency of the country you have migrated to when you move abroad. However, you may have loved ones in India who may be financially dependent on you. You can open a Non-Resident External Rupee account to ensure their financial needs are met and deposit your foreign currency earnings into it. The money will be immediately converted into INR, regardless of the deposited currency, allowing your dependants to withdraw the sums and use the money for themselves
Here are the essential things you need to know about the NRE account.
Online applicants may also be expected to obtain accredited documentation from the embassy of their country of residence. Offline applicants, along with originals and photocopies of their documents, can walk into the bank.
When you have saved up enough funds in your savings account, you can use the opportunity to earn higher interest rates on them. As opposed to the essential 3 per cent to 4 per cent interest you earn on the savings, and you can open fixed deposits. The fixed means that your deposits can be maintained for a specific period, and which is why FDs are called term deposits. Both resident and non-resident Indians can open these deposits. If you are seeking information on NRI fixed deposit, this article will guide you.
Type of FDs There are three kinds of NRI FD you can open as an NRI – NRE FD, NRO FD, and FCNR FD. While the first two are opened in INR, the third one is maintained in foreign currencies. Opening foreign currency deposit is as safe as opening NRE or NRO deposits since you need not worry about currency fluctuation on maturity. Currencies of deposits While NRO deposit is a rupee one, NRIs can open FDs in different international currencies. These include the US dollar, Great Britain Pound Sterling, European Euro, Japanese Yen, Australian Dollar, New Zealand Dollar, Singapore Dollar, and Hong Kong Dollar. Nowadays, even Swedish Krona, Danish Krone, and Swiss Francs are acceptable currencies. Investment term Usually, NRI FDs can be opened anywhere between seven days to a maximum of 10 years. Remember, this term is applicable only for NRE and NRO deposits. If there is a foreign currency deposit, the minimum and maximum investment tenure are between one to five years. Interest rates The NRI fixed deposit interest rates depend on the type of deposit you own. Since you would be depositing in foreign currencies in your FCNR and NRE FD, the interest rate differs as they are set based on LIBOR or SWAP rates. If it is an NRO deposit, most banks provide the same interest rates as opposed to resident Indian FD holders as the NRO account is primarily a rupee account. Joint holdings All kinds of NRI deposits can be held jointly. However, the individual with whom you open the deposit can differ based on the type of FD you open. For instance, if it is an NRE or FCNR deposit, the joint holder should be an NRI. Meanwhile, if it is an NRO FD, the other owner should be an Indian resident. Premature withdrawal Although FDs last through the deposit term, some banks allow you to withdraw the NRI deposits before the term ends. You can withdraw the deposits in case of financial emergency. However, you should pay the penalty for the same, which is usually a per cent of the NRI fixed deposit interest rates earned. Also, the premature withdrawal penalty gets waived off after a specific period of holding the deposits. One of the first bank accounts we open after getting a job is a savings account. Whether it is an individual or a joint account, there are different variations to a saving account. However, the differences between these accounts are minor. But the moment you begin your career and seek employment, the employers usually open a particular account called the salary account. This account is different from the regular ones. Most of them have both these accounts. So, what makes them different?
Let us consider some points to understand the difference: Purpose Anyone can open a savings bank account irrespective of gender, caste, age, or religion. Banks also have provisions for minor, senior citizens, family, and joint savings account. These accounts can be opened in more than one bank for parking savings or conducting financial transactions. Salaried accounts, on the other hand, are extended to credit income. These accounts are usually open by corporations and businesses for their employers and are primarily used to deposit income, bonuses, and other kinds of remunerations for the services rendered by the account holder. Opening of account Anyone who seeks to open a saving account can do so in the bank of their choice. You can make the selection based on varied factors like closeness of the bank from your residence, the interest offered on the savings parked, the minimum balance needed, and so forth. Some banks also allow online saving account opening through net banking or digital banking apps. However, with salaried accounts, the account holder cannot select their desired bank for opening the account. Generally, the employer chooses the same bank for all the employers, and the account gets opened for the sole purpose of crediting income. Balance maintenance Banks always set the amount to maintain a minimum balance in their account. This is one of the critical requirements of a standard savings account. The balance requirement differs from one bank to the other. On the other hand, there is no need to maintain any balance in salaried accounts. They are also called a zero-balance saving account. You can withdraw the entire salary from the account, but the withdrawal transaction is conducted according to the prescribed daily withdrawal limit decided by the bank. This is the most crucial feature between the two accounts. Conversion Most of the bank automatically converts your zero-balance savings account to a regular one if the salary does not get credited to the account for a specific period. Some banks also allow you to convert your standard saving account to a salaried one depending on situations such as a change in employment, employer’s relation with the current bank, and so on. |
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October 2020
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