We are always looking for new baskets to invest in, isn’t that true? Some of the most common investments here look at fixed deposits and gold as a whole. Gold has traditionally been one of the highly sought investments in India, and FDs, on the other hand, have also played an equally important role.
But, when you have that money to start investing in one of these – the hard work comes to play. This is when you have to choose one option from the two of them.
Stop going about asking yourself FD or gold, just read this, and it will come in handy to make your decision on which investment you want to choose and invest in.
FD Investments, and if it is For You
A fixed deposit investment is safe when you compare it to stocks and mutual funds, and also it will not be influenced by external factors and is a good choice for a long-term goal. So, even when the market is having its ups and downs – you would not be seeing it in the FD.
Also, the interest rates might not be like the returns of stocks, but you know the returns vary from bank to bank. When you do your research, you will know that IDFC bank FD interest rates, ICICI Bank FD rates, and more are different from one another.
How Can You Make an FD Investment?
If you need to make a deposit in an FD account, you will have to pick the amount and period that would match your financial objective for this investment. You can also start a fixed deposit using a specific bank’s portal, application, and more.
The Perks to Enjoy From Investing in a Fixed Deposit
- It is one of the most simple investments you could ever find with also the best tools at hand.
- The returns from this deposit would vary from 4% all the way to 8%.
- A fixed deposit will assist you to save income tax under Section 80C, and that is up to one and a half lakh.
- It is quite a low-risk investment that is not going to witness any market fluctuations and gives a guarantee with steady returns.
- It gives a compounded return. This means that the interest earned on the principal is added for the next year.
Gold Investments, and If it is For You
Gold is the most sought – as already said. It does hold a cultural significance in our country and popularly in many other societies. It also makes sure when there is a perpetual demand for the metal, it would rarely dip.
It is also always recommended to add gold to an investment portfolio, and it would distribute risk.
How Can You Make a Gold Investment?
There are quite a few ways that help you to start investing in gold, and one of these is the good old walking into a store and buying those grams. It can be in the form of jewelry, bars, coins, or anything else.
The other way is through digital gold. If you have not heard of it – you are a little behind on the game. Digital gold is just like your digital money, and also it does not have any making charges. It comes with guaranteed safety and ensured purity.
The last way you can invest in gold is through paper gold. This will mean your own gold on paper. This type of investment includes tools like gold bonds, gold funds, ETF, and more.
The Perks to Enjoy From Investing in Gold
- Banks will give you loans against the gold you own.
- It gives a reasonable rate of return and high returns when you sell at the right time.
- Gold is also utilized as a hedge against inflation and other market concerns that happen.
- Gold is also highly liquid and can be bought or sold in simple ways without going through a lot of struggle.
The Returns of your Gold Investments and your FD Investments
If you take a look at the gold prices for the last few years, it has grown, but then, it grew up a bit in 2018 and 2019. The year 2020 saw the 24k gold price surge up to 55,400 rupees for ten grams in the month of August.
Gold would be a potential option for the long term. FD, on the other side, has been comparatively low.
They have been actually dipping in the last few years.
In recent days, FDs are down to 4.90% for the ten years term, according to data. The average return for almost all gold investments is between 4.5% and 5.5%.
Conclusion
Now, you might know which is the better option for you. But, if you do not have an investment in FDs, it is always good to give it a percent of your portfolio. But, on the other hand, when you are looking for some good long-term returns – gold has known to be a good performer. But you need to know that the prices of gold will fluctuate according to the market, but that is not the case with fixed deposits.
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