When it comes to safe investments with assured returns, fixed deposits are at the top. However, one should refrain from investing on an FD scheme blindly. Here are some common investment mistakes for any FD scheme that you need to avoid while investing :
Placing Everything in One FD
A lot of investors put their entire investment in one FD. The disadvantages of doing so include zero protection under the deposit insurance scheme for deposits exceeding Rs1 lakh. With the entire sum being locked-up in an FD, you will have to break it prematurely if you end up requiring funds for an emergency.
If you are opting for multiple FDs, not spending sufficient time and effort on research will increase investment risk. Make sure to invest in FD (Fixed Deposit) schemes of reliable banks/NBFCs where risk of default is minimal.
Improper Tenure-Related Planning
Without smart tenure planning, your cash needs cannot be fulfilled in the best manner. Your investment plans should coincide with your cash needs- this means avoiding long-term investments for short-term needs and vice-versa.
Not Considering Alternate Options
Considering only FD schemes of banks leads to losing out on many feasible investment opportunities offered by alternate options like NBFCs and even co-op societies.
Aman is working in the domain of Investment management in one of the top universities. He has published research papers and case studies in Investment and Fixed Deposit marketplace. He is an avid blogger in the domain of Investment management. you can also find him on social networking platforms.