Recurring Deposits are popularly known as RD. These are not new financial products but are available since many years and are simple investments for all. In RD every month a fixed amount is contributed for a fixed tenure and on maturity customer gets the principal plus the interest. It is suggested that, we opt for small monthly contribution in RD for longer period for good wealth creation.
Benefits of RD:
- Small Investments every month. Banks offer RD with monthly investment as low as Rs. 100/- or Rs. 500/- or Rs. 1000/-.
- Competitive Interest Rates. Many offer extra interest rate for senior citizens.
- Nomination Facility Available.
- Flexible Tenure between 6 months to 10 years.
- No TDS deducted on interest earned.
- Premature withdrawal available. Loan against RD facility is also provided by banks.
- Pass book / statement / view in Mobile or Internet Banking Available.
- Goal based savings for education/marriage/higher study/buying car-home-gold jewellery etc.
- Auto debited monthly investment amount from savings account or if savings account is not opened, directly deposited cash in RD account.
- Maturity amount can be directly credited to savings accounts.