Fixed Deposits were first introduced in India in April 1992.  FD's are a place where we can put lumpsum money into the bank and after the tenure, we can collect the money with interest. Earlier our grandparents and our parents thought that FD's are the best investment scheme as the money is at zero risk but they didn't understand the fact that their money was decreasing instead of increasing due to inflation. Many of our parents still have money deposited in their Bank FD's and their money decreases as each year passes by.

FD's Maturity period consists of 1yr, 3yrs, 5yrs, 10yrs, and so on. But we also need to remember the fact that at the time of maturity we need to pay tax to the government of the country. Fixed interest rates are very less and do not beat inflation as said earlier, the interest rates vary from one bank to another. As of November 2021, the highest amount of interest that can be provided is 5.8% by the Union Bank of India for a tenure of 5 years.

The younger generation has now diversified its portfolio by investing not only in FD's but also in Stocks, cryptocurrencies, and mutual funds and moreover by creating an emergency fund for themselves.

Fun fact: If you would have invested $14 in bitcoin in 2011 then today you could buy your very own 2BHK House in India.

However, with the increase in financial literacy people have started diversifying their portfolio and have started making SIP's (Systematic Investment Plan)  for their retirements which they could then convert into SWP (Systematic Withdrawal Plan).

Banks offer many types of accounts like 
1)Savings accounts: In this type of account the customer deposits his money with the bank and can withdraw his money back whenever he requires it. the bank pays a certain interest for his deposits. The main aim of this type of accounts is to create mobility for the customers

2) Current Accounts: These accounts are for business users only. These accounts are famous as they have to maintain a high no of transactions every single day. There is no interest given to the user in this kind of accounts. But in return, the users have to pay an annual fee to the bank as service charges. The bank also offers an overdraft facility for these accounts.

3)Recurring deposit account: This kind of account is mainly opened for investment purposes. This kind of account offers interest to conusmers. In this type, the users pay a specific amount to the bank and can collect the lump sump amount all at once with interset after its maturity.  RD's are very useful for people who have to pay premiums or college fees as it doesn't burden them at once during the time of payment.

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