Highest FD Rates: 1-year or 3-year FD, which will give you more benefit? What should you choose?
Fixed deposits (FDs) are quite popular among investors. With a fixed deposit, you get guaranteed returns. Many banks offer different interest rates on fixed deposits for different investment periods.
Often, we are confused about whether a 1-year or 3-year FD is better. Let's find out which one will give you more benefits.
What are the interest rates?
Bank Interest Rate in 1 Year (%)
Bank of Baroda 6.10 6.25
Bank of India 6.25 6.25
Bank of Maharashtra 6.20 5.25
Canara Bank 6.25 6.25
Central Bank of India 6.20 6.00
Punjab National Bank 6.1 6.3
State Bank of India 6.25 6.3
1-Year FD
Advantages
If you invest for a shorter period, you get your money back sooner. You don't have to wait a long time for your principal amount, along with the interest.
You can then reinvest the received amount in another scheme. Also, if FD interest rates increase, you can take advantage of the higher rates. Even if interest rates decrease, you don't suffer any loss.
This is good for people who need this money for their short-term goals.
Disadvantages
You get lower returns compared to long-term FDs.
Advantages
The benefit of higher interest rates
No loss even if interest rates decrease
This is good for people who have long-term goals.
Disadvantages
You will have to wait a long time for your money.
If interest rates increase in the future, you miss out on that benefit.
Social media