INVESTING IN FDS READ THIS FIRST

If going for FDs

The following info shud be there in your mind.

1. Diff in rates within Nationalised banks (even if 0.5%) will have difference in short term returns. Always compare rates - Do not take things for granted.

2. RBI guarantees 1L per depositor. So, split FDs between banks

3. To maximise returns get it in name of your parents or well wishers jointly, so you will get higher returns (Some banks give 1% extra and some 0.5% extra) this makes a difference in short term investing

4. To avoid TDS, Give Form 15G (anycase Sr Citizens won't have major source of income generally). This means Extra 1 or 2%.

5. Banks offer Overdraft accounts against FD. This means you get liquidity at very low interest.

6. Negotiate with banks on Pre Payment penalty clause - many banks waive that.