Business & Finance

Saving Your Retirement Funds from a Stock Market Crash

Everyone wants their retirement to be comfortable and relaxing, and therefore they save a significant corpus for their old age. If you are investing your money in the stock market and expect higher returns, you must take into consideration the high risks associated with the stock market. Especially, the individuals that are retiring soon let’s say in 10 years or less should revise their risk appetite and look for safer investment options.

This is so, as there is a higher chance of losing your hard-earned money if the stock market crashes. There are other safe options like Recurring Deposit (RD) and Fixed Deposits (FD) etc. Among these two options also fixed deposits yield a higher return. This is a better option for the older generation as senior citizen FDs have higher interest rates. Mentioned below are the major benefits of a fixed deposit account:

Interest Rates

The interest rates on fixed deposits are high and therefore are a lucrative investment. A fixed deposit account by Bajaj Finance can yield an interest rate ranging from 8% to 8.75% on a cumulative basis and 7.72% to 8.75% on a non-cumulative basis. The high-interest rates highly help in investing your savings in the right way and ensuring a stable growth.

The FD interest rates for senior citizens FD range from 8.35% to 9.10% cumulatively and 8.07% to 9.10% non-cumulatively. Thus, if you are looking for a safe option for saving your lifetime earnings, FDs are what you need.

Return on investment

Assurance of Return on Investment

The return on investment is not influenced by any kind of fluctuations in the finance market. This provides the customers with assured returns. The safety of investment is guaranteed, and hence it is a smart choice for your retirement corpus as compared to the stock market. Bajaj finance FDs are credible as they are rated high by CRISIL’s FAAA/Stable rating and ICRA’s MAAA (stable) rating.

Low Minimum Deposit

The minimum amount for fixed deposit (FD) is as low as INR 25,000 and hence the initial investment is not a big worry. The small investment amounts in FD can be made from the beginning of your career to ensure a larger corpus by the time you retire. For middle-aged or senior citizen individuals, higher sum deposits are possible. This way they can get a higher return on investment on the larger corpus.

Flexibility in Tenor

The tenor for FD in Bajaj Finance is flexible that can largely support you in investment laddering and helps you get a higher return on Investment. The tenor can range from 12-60 months, and FD interest rates are increased for a tenor of 15 months and a minimum amount of 1,00,000, it yields higher returns overall.

This way the laddering of investments becomes possible and hence another reason to invest in FD. The money can also be layered on the basis of upcoming financial responsibilities or financial goals.

The assurance of high returns is important when you are investing for a smooth retirement. This becomes more important if you are investing as a senior citizen as the investments you are making are from your life savings.

The investment in the stock market can give good returns but there is no assurance and thus a lot of risks. When it comes to retirement, you should rely on options with lower risk factors to keep your savings safe from market risks.

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