Fixed Deposit Alternatives: Regular investment can give big returns in the long run. This is what investment experts say. There are many investment options in the market today. But all investments have some risks. However, investments like government schemes, bonds, and bank deposit schemes offer guaranteed returns. There is no risk in these cases.
When it comes to bank deposit schemes, the first thing most people think of is fixed deposits. There is nothing wrong with that. But fixed deposits cannot keep up with inflation.
Ajinka Kulkarni, CEO of Vint Wealth, says that while fixed deposits are good as a primary savings tool, they should not be relied on as the main way to create long-term wealth.
Fixed Deposits May Not Be Enough
Relying only on fixed deposits (FDs) may no longer be a smart investment strategy. While FDs are safe, experts say they are not the most profitable option in today’s volatile economy.
Ajinka Kulkarni, CEO of Vint Wealth, told a renowned news portal that FDs are good as a starting point, but they should not be the main strategy for long-term wealth creation.
5 Investment Options That Can Give Higher Returns
Here are five options that can give better returns and more diversification than FDs:
1. Government Bonds
Generally central government are issued These bonds. The main attraction of these are almost risk-free. The RBI Floating Rate Savings Bonds (FRSB) currently offer an interest rate of 8.05%. You can invest through the RBI Retail Direct Scheme.
2. Corporate Bonds
Private companies are generally Issued these bonds. They offer higher interest rates (9-11%) than FDs. These bonds carry more risk than government bonds, so investors must check the credit rating before investing.
3. Corporate FDs
These FDs offer higher returns (up to 8.5%) than bank FDs but are not guaranteed by the government. Investments in AAA-rated NBFCs like Bajaj Finserv or Shriram Finance are considered relatively safe.
4. Certificate of Deposit (CD)
These are short-term investments issued by banks and financial institutions. They usually have a tenure of 1-3 years and offer higher returns than savings accounts.
5. Sovereign Gold Bonds (SGB)
Issued by the Reserve Bank of India, these bonds are linked to the price of gold and pay an annual interest of 2.5%. New issues are now closed, so they can only be bought on exchanges.
