Recurring deposits (RD):
Features of Recurring Deposit RD allows you to earn fixed
interests on the amount invested at frequent intervals until the investment matures or a pre-determined term ends. The total amount (i.e., the capital invested and the interest accumulated)
is disbursed to the investor after the maturity period completes.
Fixed Deposits (FD) :
The investment amount has been locked in at a specific interest rate, it remains unaffected
by further changes in interest rates or market fluctuations. Thus, you can get guaranteed
returns on your deposit, and you can choose to get your interest on a periodic basis, or at
maturity. Usually, the defining criteria for FD is that the money cannot be withdrawn before
maturity, but you may withdraw them after paying a penalty.
There are two types of fixed deposits, which are differentiated on the basis of
frequency of payouts. The two types are namely, cumulative and non-cumulative
- When you invest in a cumulative fixed deposit, you do not receive interest payouts at
- When you invest in a non-cumulative fixed deposit, you receive interest payouts at
fixed intervals decided by you.
Submit the 15G/15H (For senior citizens) forms every year at the
beginning of the financial year. This will ensure that not deduct any
TDS on your interest income