Hi,
I was thinking of saving some funds in a Fixed Deposit (gifted to parents), such that the interest can be used by them for their monthly expense. As this fund would be in their name, the tax would also be nil.
But recently I was told that the interest earned on an FD (approx 9-10%) is nearly equal to the inflation rate and thus, after a year or two the FD interest will not serve the purpose. Logically I agree with this explanation.
What is your suggestion? Is it FD which is safe and secure principal or something else?
I need to do this for my in-laws as well, hence am very concerned before jumping in.
Thanks in advance,
Vijay