In India, Fixed Deposit is one of the most popular investment avenue when it comes to providing regular income along with less risk.
Being a financial instrument provided by the bank, FD’s provides much better returns than a normal saving account however one forgets the taxes which are charged on the interest.
Despite providing advantages such as low risk and regular income, the interest rate provided by the banks on FD is quiet less also tax is charged on interest which further reduces the returns provided by FD. There are number of other investment avenues in the financial market which provides much better return than Fixed Deposits.
Mutual Funds is among such investment avenues. When compared with FD’s there are number of reason why one should prefer investing in mutual fund rather than investing in Fixed Deposits.
The below Info-Graph show an unbiased comparison between Mutual fund and Fixed Deposits which can help you to choose a better investment instrument –
Pic Courtesy – FINTRAKK.COM
The below illustration may provide you a better picture between which investment instrument is better –