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Bank fixed deposit (FD) interest rate should not be the only criteria for asset allocation. There are various other benefits available for the bank FD investors like insurance and healthcare and of course, there is income tax exemption if the bank deposit is for five years or more. According to experts, bank FD is not a new tool among various asset classes but it proves to be a good investment option when the market becomes highly volatile.

Speaking on the benefits of bank FD beyond interest rate SEBI registered tax and investment expert Jitendra Solanki said, "Bank FD is one of the most favoured investment options among the investors with low risk appetite. In a volatile market as we have been witnessing in the last one month, bank FD is a smart choice. The biggest advantage of bank fixed deposit investment is its assured return feature."

However, Solanki said that there are various other advantages of bank fixed deposit investment that are beyond bank FD interest rates. He listed out the following 5 benefits of bank FD investments that adds value to the bank FD interest rate:

1] Overdraft facility: A bank customer is eligible for overdraft facility against its bank FD. This feature of the bank FD helps investor raise fund during financial emergency.

2] Insurance, healthcare benefit: These days, various banks are offering value-added bank FDs. These value added bank fixed deposits are offering free insurance and healthcare benefits to the bank FD investors.

3] Income tax benefit: Indian banks offer tax-saving bank fixed deposits that helps an investor claim tax exemption under Section 80C of the Income Tax Act, 1961.

4] Assured return benefit: As mentioned earlier, bank fixed deposit returns don’t fluctuate like many asset class. It helps an investor develop habit of investment at early age as one can invest in bank FD with small amount for smaller time-frame like 15 days to 3 month as well.

5] Ease of handling bank FD: Now a day, bank fixed deposit no more required lengthy banking process of visiting the bank branch and standing inn cue for hours to open bank FD or deposit in bank FD. In the era of internet banking, one can open or close bank FD by devoting few minutes on the computer or on the mobile phone.

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