May 1, 2012 12:39 pm
Is it safe to get long term FD from Co-Op banks, those are offering interest rate 10.75 per Annam. wanted to know more about FD vs ULIP vs MF.
Dear Shekhar, what’s your age & Tax slab?
i am 29 year old & comes under 5 lacs + tax slab.
Dear Shekhar, as you are in 20.6% tax slab, the on paper return of 10.75% ‘ll be lower for you. Due to tax, the actual return ‘ll fall to 8.54% only. Do remember, your salary ‘ll keep on increaseing over the period in few years time, you ‘l reach to 30% slab & at that time same 10.75% FD if available to investment, ‘ll actual provide you return around 7.43%.
So take your own pick.
If u invest 1 lakh, one percent interest diference will amount to Rs. 1000 per year.
But if at all there is any problem with the bank, the amount of headache you will have is much more than that.
I have seen people who lost lakhs of ruppes in co-operative banks.
So i request you my dear friend, put your money in a Nationalised bank.
Dont think of 1 or 2 percent interest difference.
Given a choice i would stay away from cooperative banks. There are few cooperative banks there deposit of 1 lakh is insured.
Regarding FD vs MF vs ULIP.
Fixed Deposit is debt and MF and Ulip are market linked. Ulip comes under investment cume insurance. Between Ulip and MF, from investment perspective i would prefer MF.
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