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Fixed Deposit (FD)
A fixed deposit is an amount placed with a bank for a fixed term, from a week to ten years, at an interest rate that does not change. Withdrawing early usually means a small penalty. Interest is taxable at your income tax rate.
Why It Matters
FDs are safe and predictable, but after tax and inflation their real return can be close to zero.
In India
Banks lowered FD rates through 2025 as the RBI cut the repo rate, then began raising them again after the October 2026 hike.
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