While running small business firms, it is easy for the owner or entrepreneur to be carried away by the company’s performance and earning targets — the concept of saving slides away from the agenda and occupies a backseat. Owners do not realize it’s significance until the business gets washed down by an unexpected spell of non-performance.
When owners and firms finally gear themselves up for a tax saving investment, they are often bewildered by the sheer number of options the investment market presents.
Devised below is a comprehensive guide necessitating the importance of investments and the advantages of investing in low-risk fixed deposit schemes. Fixed deposits are deposits made by investors with financial platforms for an agreed period over a fixed rate of interests. Because of its stock market independence, fixed deposits are often the go-to tool of smart investors.
Importance of investing
1. Healthy practice
Investing helps firms understand
- The general inflow and outflow of money
- Better knowledge of the yields and returns
- Importance of tax planning and optimizing returns
2. Positive impact on stakeholders
Investing leaves a positive note and gives healthy reflections to investors on the process and mindset of the small firm business.
3. Saving for sudden financial crunches
It is not always bright sunny days for business undertakings. Healthy investments are assured ways for firms and owners to lay back on such unforeseen challenges.
4. Positive vibes on team members
A shared positivity reflects the success of any small business firm. Investments send out positive vibes to the team, thus helping them work and plan together towards the common goal of success.
Why are Fixed deposits a viable option for investment?
A small business firm can often be conservative about their principal of investment. Fixed deposits with their market independence nature are a secured means of ensuring guaranteed returns.
2. Interest rates
Although on a general FD rates comparison, fixed deposits might be visible as a lower return tool compared to stock market investments like mutual funds. However, Non-Banking Financial platforms such as PNB Housing Finance, for example, provide the highest FD rates up to 8.40% on its fixed deposits. With higher returns and higher credibility, investors can gain the same assured returns as received on a high-risk unpredictable investment tool like mutual funds.
3. Tenure flexibility
Fixed deposits with NBFCs, like PNB Housing Finance, offers all its investor the flexibility to choose between cumulative and non-cumulative options.
4. Loan against FD
Financial platforms such as PNB Housing Finance, enable investors to avail loan value up to 75% of their deposit available. Such provisions help investors meet their immediate financial emergencies.
5. Ease of Liquidity
Fixed deposits can easily be liquified during immediate financial requirements. However, premature withdrawal penalties will be charged depending on the bank or NBFC.
Investing is a healthy habit that has to be developed in all business firms. Besides tax-saving benefits, it also promises a viable source of income. Fixed deposits with its low-risk benefits and guaranteed returns, thus helping every firm align with its futuristic goals.