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2 mins Read | 9 Months Ago

Secure your future: Top 5 benefits of Recurring Deposits


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Everyone tries to save some amount from their savings to build wealth, reach financial goals or plan a significant expense. If this idea resonates with you, consider opening a Recurring Deposit (RD) Account, as it may be exactly what you are seeking. An RD is a type of Deposit Account that enables you to deposit money for a predetermined period (typically monthly) for a duration ranging from 6 months to 10 years (as is the case at ICICI Bank). As a result, you earn interest on your deposits at a fixed rate agreed upon when you open the account.

There are several benefits of RDs that make them an attractive option for investors who want to save money and achieve certain goals. In this blog, we will explore the top 5 benefits of Recurring Deposits and how they can help you grow your wealth.

RDs for Assured Benefits

RDs come with a host of benefits that are not just restricted to earning interest on what you invest. Here are some big takeaways for RD Account holders.

1. Ensure regular savings with a disciplined approach

One of the major advantages of setting up an RD is that it enables you to save money consistently. By opening an RD Account, you commit to depositing a specific amount of money each month for a predetermined duration. This promotes a disciplined approach to saving money and guarantees that you allocate a portion of your earnings every month, instead of potentially squandering it on unnecessary items.

This ethos of consistent saving that RD Accounts promote can be particularly beneficial if you are trying to save money for a specific goal, such as buying a car, taking a vacation or even funding your child's education. The iWish Goal Based Savings by ICICI Bank is a byproduct of this school of thought. By making regular deposits into your RD Account, you can steadily build up your savings over time and move towards your financial goals faster.

ICICI Bank provides a distinctive RD experience that customers can initiate online in less than a minute. You have the flexibility to define your savings goals and timelines and track your progress towards achieving them.

Higher interest rates

A significant benefit of opting for RDs is that they generally offer higher interest rates than regular Savings Accounts, resulting in greater returns on your savings.

The interest rates on RD Accounts may differ based on factors like the bank, deposit duration and the age of the depositor. At ICICI Bank, senior citizens are eligible for higher interest rates on their RDs. Additionally, the power of compound interest can work wonders, accelerating the growth of your savings and earnings.

Flexible tenures

Recurring Deposits come with flexible tenures. It means you will be able to choose the duration of your deposit based on your financial goals and needs. ICICI Bank’s RD Accounts typically have tenures ranging from 6 months to 10 years and you can use our online RD calculator to choose a tenure that works best for you.

If you are saving money for a short-term goal, such as a vacation or a down payment on a car, then a shorter tenure would work. On the other hand, if you are saving money for a long-term goal, such as retirement or your child's education, then a longer tenure will naturally be a better choice.

Over the course of your RD, you can also make partial withdrawals from your account without penalty, which can be useful if you need to access your savings before the end of the deposit tenure.

Guaranteed returns

Finally, the biggest benefit of RDs is their guaranteed returns. When you open an RD Account, you agree to a fixed rate of interest for the entire duration of the deposit. Market volatility and so on will not affect the amount of money you stand to earn once your RD matures. You can be assured of a certain level of return on your investment, regardless of market fluctuations or changes in interest rates.

This can be especially beneficial if you are seeking a low-risk investment option that offers predictable returns. Since you know exactly how much money you will earn, you can plan and budget for your financial goals accordingly.

No Penalties for Missing Deposits

While there is a nominal penalty for missing regular RD deposits, this is not the case for flexible RDs like the iWish Goal Based Savings. You can make your deposits as and when you please and never worry about any additional charges or penalties.

How to Open a Recurring Deposit with ICICI Bank?

You can open an RD Account for 6 months to 10 years, at rates beginning from 4.75% going all the way to 7.10% (7.60% for senior citizens) with ICICI Bank, using any of the following methods.

1. Visit your nearest ICICI Bank and our representatives will take you through the process

2. Log into the iMobile Pay app and click on ‘Accounts & Deposits,’ followed by ‘Deposits (FD/RD)’ and ‘Open Recurring Deposit’

3. Log into with your Internet Banking User ID and Password and click on Bank Accounts, followed by “Deposits” and“Create RD” on the next page. Then choose the ‘Open Recurring Deposit’ option

4. Get in touch with us through Customer Care in a language of your preference. All you need to do is enter your Debit Card number along with the PIN to take things ahead with our telecom representatives.

RDs for Recurring Benefits

RDs are a highly preferred investment option among those who wish to save and earn to achieve their financial goals and offers several benefits. These include savings, better interest rates, flexible tenures and guaranteed returns, making an RD a valuable addition to one’s financial portfolio.

Furthermore, with iWish Goal Based Savings - a special offering from ICICI Bank, you can allocate savings for specific objectives and monitor your progress towards achieving them, all the while earning guaranteed returns on your deposits.

It is important to remember that when it comes to saving money and building wealth, every bit counts. Therefore, by choosing to invest in an RD and making regular contributions, you can establish a solid foundation for achieving your financial aspirations.

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