Recurring deposit is a traditional financial tool that remains applicable in today's market as well. It does not have the modern terminologies and attractions, but it has a solid foundation with profitable rewards. So, here are the three main reasons to select the recurring deposit over other financial tools.
Economic meltdown: Recession is always a part of the financial circle. Though, there are several systematic investment plans (SIP) that function similar to recurring deposit. But, these mutual funds are based on the stock market and do not have guarantee of performance. Your fund can soar to great heights on tank just as badly. So, if there is a recession going on, it is a wiser choice to put your investments in the bank's recurring depositrather than market-based plans.
Investment Diversification: You have invested in stock market. It is a high risk high gain investment space and so is real estate. You can invest in market-allied financial products. But, you need to have a backup plan that can support you when the market is bearish. Setting small funds aside on regular basis into a recurring deposit will create a great and rewarding asset for your future. You do not need make it the biggest investment in your portfolio. You just need to make it the most consistent one and you will benefit from it.
Safe Investment Planning: Are you paying EMI for your home loan? What about the car loan? You cannot make risky decisions, when you have responsibilities, expenses to pay, family to care for. You need to make monthly savings. But, you need to invest in the safe financial products only. You should choose the low risk financial tool for monthly savings. So, invest in recurring deposits and make it a profitable investment for you rather than keeping in your savings account.
So, these are one of the many reasons, why people choose to invest in recurring deposits rather than SIP (systematic investment plan). You need to choose the right interest rate and right facilities to support you though the process. The best way to select the right recurring depositis choose right bank for your investment. Once you select that, the rest of the details fall in place automatically. So, make smart choices for your monthly extra cash and create value for your family's future. It can be useful to make bigger and better investments or to skirt through some small emergencies as well.
Source: http://www.sooperarticles.com/finance-articles/3-smart-reasons-select-recurring-deposit-1342505.html? Thank You! http://www.facebook.com/idbibank https://plus.google.com/+IDBIBank https://in.linkedin.com/company/idbi-bank http://www.twitter.com/idbi_bank http://www.youtube.com/idbibank