Distribution of 10L for FD

raviraaj16594

KF Rookie
Planning to put aside 10L for emergency situations in FD. Can anyone suggest how can I split the amount and the duration so that if required I hv some amount at my disposal in a few months time?
 

17ysaurabh

KF Mentor
Step 1:
If I would be in your place, I would split it into 3 parts: 4 lakh + 3 lakh + 3 lakh

Since RBI only insures up to 5 lakhs in a bank (both principal + interest).

Therefore, this will help me get both my principal and interest amount in case of issues with the bank.

Step 2:
Find 3 private banks which are giving high-interest rates and invest one part in each of them.

Step 3 (Optional):
You can also try FD laddering.
Explanation:
It means you invest 1 part for 1 year FD, 2nd part for 2 year FD and 3rd part in 3 year FD.
Now,
After 1st year, one FD matures if you need to use it or else you can reinvest it for 3 years FD.
After 2nd year, the second FD matures if you need to use it or else you can reinvest it for 3 years FD.
After 3rd year, the third FD matures if you need to use it or else you can reinvest it for 3 years FD.

Post that every year one of your FDs matures and you can use the amount if needed.

Tips:
If you want to invest for emergency situations, then that means the money should be liquid. You should be able to get it back in 1-3 days.
For such a case, there are platforms like the INDMoney app which provides instant withdrawal FDs. You can check them.
 
Step 1:
If I would be in your place, I would split it into 3 parts: 4 lakh + 3 lakh + 3 lakh

Since RBI only insures up to 5 lakhs in a bank (both principal + interest).

Therefore, this will help me get both my principal and interest amount in case of issues with the bank.

Step 2:
Find 3 private banks which are giving high-interest rates and invest one part in each of them.

Step 3 (Optional):
You can also try FD laddering.
Explanation:
It means you invest 1 part for 1 year FD, 2nd part for 2 year FD and 3rd part in 3 year FD.
Now,
After 1st year, one FD matures if you need to use it or else you can reinvest it for 3 years FD.
After 2nd year, the second FD matures if you need to use it or else you can reinvest it for 3 years FD.
After 3rd year, the third FD matures if you need to use it or else you can reinvest it for 3 years FD.

Post that every year one of your FDs matures and you can use the amount if needed.

Tips:
If you want to invest for emergency situations, then that means the money should be liquid. You should be able to get it back in 1-3 days.
For such a case, there are platforms like the INDMoney app which provides instant withdrawal FDs. You can check them.
Paytm also provide liquidity
 

Gigachad

KF Mentor
Planning to put aside 10L for emergency situations in FD. Can anyone suggest how can I split the amount and the duration so that if required I hv some amount at my disposal in a few months time?
Break this into 3or4 pieces & put them on SFB with different person account in family
 

cardy

KF Expert
I would recommend @17ysaurabh 's answer. Going to the bank route is more safe than indmoney etc third party apps.

Besides you can put some of it in mutual funds also.
 
Planning to put aside 10L for emergency situations in FD. Can anyone suggest how can I split the amount and the duration so that if required I hv some amount at my disposal in a few months time?
1. **Allocation:**
- Split the 10 lakh into three parts: 4 lakh, 3 lakh, and 3 lakh.

2. **Investment Options:**
- Consider investing in different small finance banks:
- Invest 4 lakh for a 9% interest rate.
- Invest 3 lakh for a 9% interest rate.
- Invest another 3 lakh for a 9% interest rate.

3. **Private Bank Option:**
- Private banks offer a 7.75% interest rate.

4. **Comparison Analysis:**
- Compared rates from 50 different banks and found that for a 5-year period, the highest return is expected.

5. **Liquidity Consideration:**
- Be mindful of liquidity; if you withdraw an FD before the maturity period, a penalty of 1% is applicable.
- Always inquire about pre-mature penalty terms before making any investment decisions.
 
Planning to put aside 10L for emergency situations in FD. Can anyone suggest how can I split the amount and the duration so that if required I hv some amount at my disposal in a few months time?
 

Attachments

  • 20240202_124528_0000.png
    20240202_124528_0000.png
    102.3 KB · Views: 4
  • 20240202_124528_0001.png
    20240202_124528_0001.png
    172.2 KB · Views: 3
  • 20240202_124528_0002.png
    20240202_124528_0002.png
    170.2 KB · Views: 4
  • 20240202_124529_0004.png
    20240202_124529_0004.png
    191 KB · Views: 4
  • 20240202_124528_0003.png
    20240202_124528_0003.png
    168.6 KB · Views: 4

Ria

KF Ace
Paytm also provide liquidity
Kindly stop using Paytm after Feb 24, as RBI deregularised paytm due to non compliance and has been ordered to not accept any new customers.
 

Attachments

  • Why RBI lost patience with Paytm Payments Bank_ Anti-money laundering lapses, related party tr...pdf
    991 KB · Views: 2
Split into 3 and you can consider Unity Small Finance Bank as well it offers 8.75%p.a. for 6 months
After comparing Suryoday and Unity, the primary difference lies in their offerings, with Suryoday providing a 9.1% interest rate for 5 years and Unity offering 9% for 1001 days. For an investment of ₹1,00,000, Suryoday yields a profit of ₹45,500, whereas Unity's profit is ₹24,682.

Calculating on a daily basis, Suryoday provides a profit of ₹24.93 per day, while Unity offers ₹24.66 per day. The marginal difference favors Suryoday, and hence, I choose Suryoday over Unity for the investment.
 
Top