An investor who had invested in a fixed deposit scheme should and must appoint a nominee who could take the custody of the money till the maturity if something happens to the FD holder. Yes, a nominee will get FD money on your demise!
Yes, there are numerous cases in India where you would see brothers, sisters and children and other relatives of an FD account holder fighting for the claim of the money.
Usually, people think that they will appoint a nominee after a while after opening an FD (Fixed Deposit) and time flies. Months turn into years, and in such cases, if something happens to an FD holder, the flight for the claim of the FD money begins.
That’s where the importance of a nominee matters much. Appointing a nominee also means that an account holder need not worry much as even after his/her death, the money will be taken care.
Who is an FD nominee?
A nominee is the guardian or custodian of a fixed deposit account. The task of a nominee is to take charge of the account if anything happens to you.
The name of a nominee is mentioned at the time of opening of the fixed deposit account. It’s not important for the nominee to be related blood wise to an applicant, but should be a sensible person who can take charge of the FD in an un-favourable situation.
People usually make their wife, husband, mother, father, children, and siblings as nominees.
The importance and role of an FD nominee
Let’s provide you the importance and role of an FD nominee in brief:
1. He/she is a custodian
A nominee is the custodian, guardian or an in charge of the fixed deposit account in your absence. However, a nominee has no role to play whatsoever if you are still alive.
2. Responsible for an FD account in your absence
If any matter (legal or more) related to the fixed deposit happens when the FD holder is no longer present in the city of the conflict, a nominee can take charge in this regard. If an FD holder is no longer alive before the maturity has completed, a nominee needs to complete the documentation and collect the amount after the maturity.
3. He/she is also the ‘go to’ person
Anyone can contact a nominee regarding any matter related to an FD if the FD holder is unavailable. The unavailability of an FD holder could either be due to geographical constraints or due to the passing away of the fixed deposit account holder.
Why is an FD nominee so important?
Picture this! You are no longer in this world, and your relatives are fighting over a piece of money that you have in your fixed deposit account. Will you like this situation to happen in your house? No right?
That’s where the appointment of a nominee holds so much value as it helps in maintaining the peace in your family after your demise. Any tussle when it comes to the claims of the FD amount can lead to confusion and bitterness, and a nominee can nullify all such.
The Bottom Line
Life is unpredictable, and you never know what may happen to you next moment! Thus, for all your invested money to reach its correct hands should be your duty, if no longer survive. Appointing a fixed deposit nominee can solve all such issues with ease.
Thus, if you are set to open an FD, make it a point to appoint a nominee.
Even if you have invested in an FD some years back and yet not have a nominee, it is the time to do it right away!
Also Read :- Complete Guide to Investing
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.