10 Types Of Fixed Deposit Accounts You Can Invest In

Fixed deposits (FDs) are one of the most popular investment options in India, offering guaranteed returns and capital safety. However, with so many different types of FD accounts available, it can get confusing to choose the right one for your financial goals. Whether you’re saving for your child’s education, planning for retirement, or building an emergency fund, understanding the various FD options is crucial. In this article, we’ll walk you through 10 types of fixed deposit accounts you can invest in, along with their unique features and benefits.

1. Regular Fixed Deposits

    

   • The most common type of FD offered by banks and NBFCs

   • Flexible tenures ranging from 7 days to 10 years

   • Higher interest rates compared to savings accounts

   • Ideal for short to medium-term goals

   • Example: Rahul invests ₹1 lakh in a regular FD with Airtel Finance for 1 year at 6.5% p.a. On maturity, he receives ₹1,06,500.

      

2. Tax-Saver Fixed Deposits

    

   • Qualify for tax deduction up to ₹1.5 lakh under Section 80C

   • Mandatory lock-in period of 5 years

   • Suitable for long-term goals and tax planning

   • Interest is taxable; no loans allowed against deposit

   • Example: Priya invests ₹1.5 lakh in a tax-saver FD and saves ₹46,800 in taxes (assuming 30% tax bracket)

      

3. Senior Citizen Fixed Deposits

    

   • Exclusive FDs for investors aged 60 years and above

   • Offer higher interest rates than regular FDs (0.25% to 0.75% more)

   • Same flexible tenures and payout options as regular FDs

   • Example: Suresh, 65, invests ₹5 lakh in a senior citizen FD at 7.5% for 3 years, earning ₹1.21 lakh as interest.

      

4. Cumulative Fixed Deposits

    

   • Interest is compounded quarterly or annually and paid on maturity

   • Ideal for long-term wealth creation

   • Power of compounding helps money grow exponentially

   • Example: Neha invests ₹50,000 in a 5-year cumulative FD at 7%. On maturity, she receives ₹71,968.

      

5. Non-Cumulative Fixed Deposits

    

   • Interest is paid out at regular intervals (monthly, quarterly, half-yearly, annually)

   • Suitable for investors seeking regular income

   • Ideal for retirees or those with steady cash flow needs

   • Example: Mohan invests ₹10 lakh in a 3-year non-cumulative FD at 6.5%, receiving ₹5,417 as monthly interest.

Here’s a quick comparison of cumulative and non-cumulative FDs:

6. Flexi Fixed Deposits

    

   • Allow partial withdrawals without closing the entire FD

   • Offer both cumulative and non-cumulative interest options

   • Ideal for those who want liquidity along with high returns

   • Calculate your potential earnings with an FD interest calculator

      

7. NRI Fixed Deposits

    

   • Exclusive FDs for Non-Resident Indians (NRIs)

   • Can be opened in NRE, NRO or FCNR accounts

   • Offer attractive interest rates and tax benefits

   • Ideal for NRIs looking to invest surplus funds in India

      

8. Minor Fixed Deposits

    

   • FDs opened in the name of a minor child (below 18 years)

   • Can be operated by parents or legal guardians

   • Offer same interest rates as regular FDs

   • Great way to save for child’s future needs like education

      

9. Corporate Fixed Deposits

    

   • FDs offered by companies to raise funds

   • Typically offer higher interest rates than bank FDs

   • Carry higher risk compared to bank FDs

   • Suitable for investors with higher risk appetite

      

10. Specialized Fixed Deposits

     

    • Niche FDs catering to specific needs or occasions

    • Examples: Wedding FD, Education FD, Property FD, Pension FD

    • May offer additional features or benefits

    • Align with particular financial goals or life events

Whichever FD type you choose, make sure you compare interest rates, calculate returns, check the credibility of the institution, and read all terms carefully. Keep your investment horizon, financial goals, risk appetite and liquidity needs in mind.

Conclusion:

Fixed deposits are a versatile investment option, with various types catering to different financial goals and investor profiles. From regular and tax-saver FDs to specialized ones like senior citizen and NRI FDs, there’s an FD for every need. By understanding the features and benefits of each type, you can make an informed choice and maximize your savings.

Consider factors like tenure, interest rates, payout options, liquidity and taxation when selecting an FD. Don’t forget to check the required documents and open your fixed deposit with a trusted institution like Airtel Finance for a seamless and secure investment experience. Start investing in fixed deposits today and watch your wealth grow steadily over time!

FAQs:

1. What are the types of fixed deposit account?
   The main types of fixed deposit accounts are: Regular FDs, Tax-Saver FDs, Senior Citizen FDs, Cumulative FDs, Non-Cumulative FDs, Flexi FDs, NRI FDs, Minor FDs, Corporate FDs and Specialized FDs.

    

2. How many types of deposit accounts are there?
   There are primarily 10 types of fixed deposit accounts, each with unique features and benefits designed to cater to different financial goals and investor needs.

    

3. What type of account is fixed deposit?
   A fixed deposit is a type of savings account where a lump sum is locked in for a fixed tenure at a predetermined interest rate, offering guaranteed returns on maturity.