The Common Mistakes Committed While Investing in Fixed Deposits
Uncertain about which investment option will suit your individual needs in the best possible manner? Actively considering how to apply for FDs? Whatever your situation, if you do go ahead and choose a fixed deposit investment, you need to carefully analyse various facts and features. Remember to review important figures like interest rate on FD as well as the maturity. Along with these factors, it is also important to avoid certain well-known mistakes like not deciding upon a good principle amount, or investing in a single option. Such errors can severely hamper your ability to gain from the investment.
The Various Mistakes You Should Avoid
What do you do when you have no fixed goals for investment? Or have you not studied the market in advance? These qualify as the common mistakes people make before investing. Below are listed more such mistakes that you should avoid:
- Not Being Clear About your Goals: This involves having a primary reason for investing. Do you have cash in your bank or savings account that is not being used productively? Or perhaps you have savings that you seek to use for retirement? It is always important to have an objective so that you can plan cleverly for the future and select the right scheme. It can also help provide you with a sense of direction.
- Not Performing Relevant Research: Investing in any scheme requires intensive study of the market and the various interest rates. Once you have extensively studied the market on a large scale, only then should you consider investing in FDs. Research also helps you narrow down and choose an option according to your requirements. It enables you to compare various schemes and choose the correct ones.
- Choosing Only a Single Option: If you seek to become a seasoned investor and get the highest amounts of financial gains from your investment, it is important to have knowledge of various schemes and invest wisely. A single investment is less likely to give you high amounts of returns so it best to choose more than one scheme.
- Not Monitoring and Recording Your Investment: At every stage of the investment, it is important for you to have a clear record of the returns and the account details. It is important to pay attention to your bank statements and passbook entries of the fixed deposit account.
- Not Considering Inflation: Inflation is the rise in the rates of commodities and services. Inflation impacts the overall value of money over time. Hence, before investing, it is important to consider inflation and plan and invest a sum that is likely to be valuable in terms of the value of money after the tenor.
- Investing in Insurance Simultaneously: No matter how many FDs or investment options you have, it is always necessary to keep aside an insurance policy, apart from investments. These policies help secure your family and loved ones in unforeseen events. This way, in cases of emergency, you always have an insurance policy as a backup option. This will ensure that you do not have to break your deposits or other investments in case the urgent need for cash arises.
If you avoid these mistakes, it is likely that you could gain more rewards from your investment. You can use the FD calculator to calculate the returns of your FD and apply for an FD . Bajaj Finance offers you attractive interest rates and user-friendly features with its rewarding FD scheme.