Mutual Funds v/s Fixed Deposit
Do you wish to grow your hard-earned savings? If yes, which investment plan should you opt for? In the current market, Mutual Funds and Fixed deposits are the most popular plans for investment which ensures decent yield with low risk. But which one of these two should you opt for? Should you choose Mutual Funds or opt for Fixed Deposits?
A comparison between these two investment avenues will help you decide. Fixed Deposits offer assured returns, while returns are dependent on the market in case of mutual funds. When it comes to the aspect of inflation-adjusted returns, you can expect moderate returns in case of Fixed Deposits although mutual funds offer the possibilities of higher returns. If you assess the risk factor, mutual funds are investment options, which are always subject to market risks while fixed deposits are low risk options. In case of premature withdrawal, it is allowed in case of both Fixed Deposits and Mutual Funds. In case of the former, you have to pay a penalty while you have to tackle the exit load in case of the latter.
In case of taxation on Fixed Deposits, it depends on the slab while in case of mutual funds, taxes vary from one fund to another. Both mutual funds and fixed deposits offer distinct advantages. You should do your homework and make a smart choice based on your requirements.