If you consider FD as a safe savings option, then by all means know these 3 tricks, you will make strong returns every year.

New Delhi. Even though mutual funds and the stock market are considered high-yield investment opportunities, a large part of the population still prefers to invest money in time deposits. This is because there is no market risk with FD. For this reason, fixed deposits are considered to be the most popular savings option in India.

With FD, a lump sum is deposited for a set period of time at a fixed interest rate. At the end of the term, compound interest at the interest rate set on it is available in addition to the capital amount. So if you have a lump sum and want to deposit it as a fixed deposit, here are a few tricks you can use to increase your earnings from FD.

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First trick: FD in a small financial bank
You know that small financial banks pay more interest on FD than large banks. While regular banks offer a maximum interest rate of 6 to 7 percent, small financial banks offer interest rates above 8 percent and in many cases up to 9 percent.

Now the question of the safety of your deposits may come to mind: What happens if the small financial bank you have FD with goes under? The answer is that small financial banks are covered by the Deposit Insurance and Credit Guarantee Corporation Act, which is the DICGC Act of 1961. It is insured for up to five lakh. That means you get the money back up to five lakhs. You just have to keep in mind that after the FD is due, the sum insured should not exceed 5 lakhs.

Second trick: do FD for a day, not a year
Whenever you go to FD, do FD for a day, not a year. The interest rate available at FD varies for different time periods. 7 to 14 days interest rate will be different, 15 to 29 days will be different, similarly 6 to 9 months will be different, 9 months will be one day to 12 months, similarly 12 months will be one day to 18 months. Compared to a year, a year’s interest rate is one and a half to two percent higher per day. In such a situation, FD can give you more returns with just a day’s difference.

Third trick: Don’t put all your money in an FD
Divide it into three parts. Put the first part in FD for a year and a day. The second for two years and the third for three years. (Check the interest rate for a day’s difference between two and three years and put the money away.) When your first FD comes due, keep the interest with you if you like, or put the entire amount in the three-year FD. Do the same with the FD that will mature next year. Do the same with the third year girl. This is how one of your FDs will mature each year.

So try these tricks too. Not only does this increase the return you get on your FD, but it also ensures that one or the other of your FDs comes due every year.

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Keywords: bank interest rate, Business News in Hindi, fixed deposits, sbi