What is even the essence of holding money in fixed deposits?

[Min George]

There are people that hold the funds they don't want to spend in fixed deposit accounts. Looking at the interest rates that fixed deposits offer in commercial banks, it is very low. Does it even make any sense to hold your money in fixed deposit accounts?

 

[Suba]

I also have fixed deposits that I haven't cashed in for more than five years, even though the interest is low compared to other investment returns, I do it as a portfolio diversification where fixed deposits have a low risk level, I can also use it as an emergency reserve fund, because I can only withdraw on a predetermined date, the extension of term deposits is done automatically.

 

[Fidelia]

People just hold fixed deposited for funds that they really don't want to consider touching. That's the much it serves.

 

[Augusta]

The essence of holding money in fixed deposits is providing a safer, potentially higher return investment than traditional savings accounts.

 

[eLdavis]

Besides the fact that you are saving your money, having a fixed deposit account provides a ground for your money to grow while you save.

 

[Springtime]

I have a fixed deposit account which holds money not for daily use. I have other investments. Money in fixed deposit account is part of my portfolio to balance the risk I invest in stocks.

 

[Nomad]

Fixed deposit accounts give you an interest rate that is (better than a normal saving and not as risky as stock investment

 

[King Belieal]

Fixed deposits just helps you from spending the money. The interest rate is so poor and people do it not for the interest but just not to spend the money.

 

[Augusta]

Yes it's for safety and stability, assured returns, flexibility in tenure, loan against FD, and tax benefits.