There are many financial and insurance products available in the market wherein you can invest and receive higher returns on your investments. Among the products available in the market, Fixed Deposit (FD) and Life Insurance (LI) are the two most popularly used investment products.
Although life insurance is an insurance product, many people use life insurance as an investment product. On the other hand, fixed deposit is a purely investment product wherein you can invest for different tenures. However, both life insurance and fixed deposits serve your different needs.
| Category | Fixed Deposit | Life Insurance |
|---|---|---|
| Tenure | 7 days to 10 years | Minimum of 10 years |
| Returns | Fixed interest rate | Depends on the market |
| Tax Benefits | May not be provided | Tax benefits can be availed |
| Withdrawal | Premature withdrawal is allowed | Depends on the type of life insurance |
| Loan Option | Loans can be availed | Loans can be availed |
Fixed Deposits
The different types of FDs that are offered are mentioned below:
Life Insurance
The different types of life insurance policies that are offered are given below:
Fixed deposit is always a better option to invest as it is purely designed for your investment and savings related needs. If your intention is to save and invest for the future, it is advisable you invest in fixed deposits. Listed below are some of the major differences between fixed deposits and life insurance.
No, fixed deposit accounts do not provide risk coverage. However, you can get assured returns on your investments with your FD account.
You can invest in a fixed deposit account for a minimum tenure of 7 days.
Yes, you can withdraw your fixed deposits to meet your emergency expenses by giving prior notification to your bank.
Yes, you can get tax benefits under section 80C and 80D of the Indian Income Tax Act, 1961 by purchasing life insurance policies.
Fixed deposit is an investment product meant for savings while life insurance is an insurance product primarily designed for risk coverage and savings.
Yes, you can take loan against your FD.
Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.
