Corporate Fixed Deposit Schemes offer you higher interest than banks. Through these high-interest schemes, they aim to attract their bank-going customers. But, like the FDs offered by the banks, the interest rates of corporate FDs are stable. You can compare the interest rates of multiple corporate FDs before opening your FD account. However, if a company is offering unusually higher FD interest rates than the others in the market, it is advised to be cautious. Here are some ways in which you can invest your money in reliable and high-interest corporate FD schemes:
Tenure: The highest risk with investing in a corporate FD, is the risk of the company defaulting. A longer tenure is always better for high returns on FD, but it also might come with some risks. So, consider investing in such FDs for shorter durations.
Invest Smartly: It is always advisable to break up your investment amount and invest it into multiple FD accounts. Putting all your eggs in one basket may incur some risks.
Credit Rating: Always check the credit and solvency rating of the company before investing your money. You should keep track of it over the tenure of your FD since these change over time. If the credit rating of a company falls mid-tenure, considering moving your money elsewhere.
Corporate fixed deposits are best if you want high returns on your investment. However, if you withdraw your money within six months of your deposit, you lose your interest. If you withdraw your cash between 6-12 months of your deposit, you lose a certain percentage of the interest. So, choose wisely.
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