When you’re looking to invest a significant sum, like Rs 10–15 lakh, in fixed deposits (FD), choosing the right FD strategy is just as crucial as finding the best interest rate. Smaller private sector banks and small finance banks usually provide higher interest rates on FDs, but they come with some risks. If you are aiming for those higher rates, be prepared to accept a bit more risk. Plus, you will only have a safety net of Rs 5 lakh insurance cover, which means larger FDs could be at risk if the bank fails.
Should you invest the whole amount in a single FD or spread it out across multiple deposits? Splitting your investment can provide better liquidity, increased deposit insurance coverage and more flexibility, but it also has its downsides.
