I am looking for a failry liquid investment instrument from which I can withdraw money anytime but with a safe and decent return. For this, small finance FDs (up to max 5 lakhs) and T-bills are the best so far (according to my research, pls suggest others if any). But between the two, after considering taxation, which is better in terms of returns? Can someone suggest?
FD vs T-BILLS
- Thread starter ekta
- Start date
Few differences
-T- Bills have slightly higher liquidity - since you can sell these in secondary market. In case of FDs the only option will be premature withdrawal
-T-Bills are subject to Short Term Capital Gains Tax - meaning you will be charged Tax as per your income and tax slab. In case of FD also your interest will be fully taxable as per your tax slab.
-T-Bills usually have lower rates because they're considered relatively safer (due to sovereign guarantee)
-T- Bills have slightly higher liquidity - since you can sell these in secondary market. In case of FDs the only option will be premature withdrawal
-T-Bills are subject to Short Term Capital Gains Tax - meaning you will be charged Tax as per your income and tax slab. In case of FD also your interest will be fully taxable as per your tax slab.
-T-Bills usually have lower rates because they're considered relatively safer (due to sovereign guarantee)
jeenahaiabhiii
KF Ace
I enjoy both Kajukatli and Gulab Jamun! Regarding FD vs T-bill, I recommend a balanced approach: 50% in T-bills and 50% in FDs. However, if you prefer one over the other, compare their interest rates. Invest in FD if it offers higher returns, and vice versa for T-bills. Share your time period and investment amount for FD recommendations. I'll need to research T-bills and can provide an answer after this Sunday.
jeenahaiabhiii
KF Ace
I became curious about T-Bills when you mentioned them, so I decided to explore further. I discovered the process of investing in T-Bills and found it intriguing. To make an informed decision, I opened an account on RBI Retail and diligently calculated the details of T-Bill Investments.
- Invested Amount: ₹1,00,000
- T1:
- Tenure: 91 days
- Interest Rate: 6.9976%
- Interest Amount: ₹1,744.607123
- Maturity Amount: ₹1,01,744.6071
- Interest per Day: ₹19.17150685
- T2:
- Tenure: 182 days
- Interest Rate: 7.1376%
- Interest Amount: ₹3,559.022466
- Maturity Amount: ₹1,03,559.0225
- Interest per Day: ₹19.55506849
- T3:
- Tenure: 364 days
- Interest Rate: 7.1088%
- Interest Amount: ₹7,089.323836
- Maturity Amount: ₹1,07,089.3238
- Interest per Day: ₹19.47616438
keshavmishra
KF Rookie
NIRANJAN SINGH RANAWAT
KF Rookie
There is no need of premature withdrawal of FD. You can avail OD against your deposit. And it can be availed within a minute through mobile/Internet Banking. So FD will became more liquid.
NIRANJAN SINGH RANAWAT
KF Rookie
Both are good options. You can consider fixed deposits. Now the interest rate on fixed deposits is at its peak. You should open 5 fixed deposits of Rs 1 lakh each so that the interest on a single deposit does not exceed Rs 10K and TDS is not deducted. And if you need money in an emergency, you can avail overdraft facility on your deposit so that you do not face penalty of premature withdrawal.
luciferocious
KF Mentor
watching
rohit_20085
KF Ace
Both are taxed according to your tax bracket. But you can get slightly higher rate in FD of small finance banks.