SIP vs Fixed Deposit: What will you get in return if you invest Rs 5,00,000 in each?
Compare mutual funds and fixed deposits to see what returns Rs 5 lakh investment can yield in 5 years. Understand features, benefits, risks, and tax-saving options to make informed decisions.
Mutual funds and Post office fixed deposits (FDs) are popular investment options with distinct features and benefits. Mutual funds pool money from investors to invest in stocks, bonds or other securities, offering potential high returns but carrying market risks. Fixed deposits, on the other hand, are risk-free savings schemes that provide guaranteed returns at pre-decided interest rates over a fixed tenure. This article explores some of the key benefits of the two investment avenues. Here are some of the key points to remember while picking between the two.
(Disclaimer: This is not an investment advice. Do your own due diligence or consult an expert for financial planning)
What Are Mutual Funds?
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Why Do People Buy Mutual Funds?
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Types of Mutual Funds
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- Money Market Funds: Low-risk investments in high-quality, short-term securities.
- Bond Funds: Moderate to high-risk investments with varied returns.
- Stock Funds: Investments in corporate stocks, offering options like growth funds and sector funds.
- Target Date Funds: Adjust investment mix based on target retirement date.
Benefits and risks of Mutual Funds
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Mutual Fund returns on Rs 5 lakh in 5 years (Lump Sum)
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Mutual Fund SIP Returns (Monthly Rs 8,333)
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Fixed Deposit (FD)
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Eligibility and Investment Limits
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Tenures and Tax Benefits
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Premature withdrawal
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