Your Questions Answered: What are the comparisons and differences between FDs and debt mutual funds?
Investors often grapple with choosing between debt mutual funds and fixed deposits due to their differing risk, returns, and liquidity. A comprehensive grasp of their intricacies is essential for informed investment choices.
Q. I am a civil engineer working with one of India’s largest private construction companies. My wife is also a civil engineer working as an independent consultant. Both of us are situated in the top tax bracket. We have been investing in debt mutual funds for the past 10 years. However, we now understand that after the budget 2023 tax benefits associated with the debt mutual funds have been withdrawn. Can you please elaborate on the same? We are now contemplating investing in fixed deposits. Can you please compare and contrast investment in fixed deposits vs. investment in debt mutual funds?
In the realm of financial planning, the choice between debt mutual funds and fixed deposits (FDs) remains a common conundrum for investors. Both instruments serve as repositories of savings, offering varying degrees of risk, returns, and liquidity. A thorough understanding of their nuances is crucial for making informed investment decisions.