Small investors: There are many types of schemes available in the market for investment. People invest in them according to their budget. For small investors who can start investing with less money, today we are going to tell them a better investment option.
Many people invest in FD but you have to deposit a large lump sum amount in it. Whereas, Recurring Deposit (RD) is a better option for investment, in this you can start saving even with a small amount. Investors who want to create a fund by saving regularly must know about the benefits of RD.
Saving habit
By starting investing in RD, investors get into the habit of saving every month. In such a situation, you can save in it every month and make a good saving for the future.
Start with a small amount
You need a lump sum amount for FD, but this is not the case with RD. In this investment option, you can start with just Rs 500 or even less.
Option to increase investment
In this option, investors get the facility to deposit as per their convenience. If the income of the investor is increasing, then he can also increase the amount of his RD. You do not get this option in FD.
Profit of Compounding Interest
Recurring deposits made by post offices or banks usually offer the benefit of compounding interest. In simple terms, investors get interest on the interest along with the principal amount deposited by them.
Loan facility on recurring deposit
Some banks provide loan facility on recurring deposit, so that money can be given to investors in case of need without breaking the RD.