We recently came across this post and realized that our FDs are actually losing Money.
The value of Rs 100 deposited with a bank for one year carrying 6.90% interest (now offered by SBI) would fetch you Rs 6.90 towards annual interest.
But due to inflation, the real value of this would have fallen by ↓8.56%. (If inflation rate=8.56%)
That means the real value of the deposit of Rs 100 has fallen to Rs 98.34 (8.56% – 6.90% = 1.66%)
Many people who invest in FDs do not even know that they should consider inflation, interest rates and taxation before zeroing on an investment decision. So instead of gaining money from their investment, they end up losing it.
Now, you might be thinking – “If bank Fixed Deposits are not a good place to put my money to work, how else should I be saving my money smartly?”
We would say, invest in a Money Club! You would be surprised to know that people have already earned more than 12-15% returns (annualised) on their savings in this innovative savings model.
Want to know more? Click here