BusinessFD vs Small Savings: Key Factors Before Investing
Choosing between Fixed Deposits (FDs) and Small Savings Schemes requires more than comparing interest rates. Consider deposit limits, lock-in periods, tax implications, and safety. For Q2 FY27, PPF offers 7.1%, NSC 7.7%, SCSS 8.2%, and 5-year Post Office Deposits 7.5%. Bank FD rates vary widely and allow flexible amounts and premature withdrawal with penalties. Small savings have annual caps and longer lock-ins, with PPF deposits capped at Rs 1.5 lakh annually and SCSS at Rs 30 lakh. Tax treatment differs, with PPF interest being tax-exempt.
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