Top Reasons Why FD is Better Than Savings Account

Both fixed deposit and savings accounts offer guaranteed returns on the surplus funds you wish to invest.

What is the difference between Fixed Deposit and Savings Account?

Fixed deposit is when you deposit money for a fixed period, and the bank/financial institution pays interest on the amount invested. You must ideally not withdraw the amount before the fixed tenure is due.

Whereas, in a Savings Account, you can deposit and withdraw money as and when you want. This is a basic account offered by all banks in India.

FD’s offer higher returns on the investment, and therefore, investors prefer Fixed Deposits over Savings Account.

Higher Rate of Interest:

When you invest your hard-earned money, you can earn the best-fixed deposit interest rate in India. Instead of saving in a Savings Account, you might want to earn higher returns by putting it in a PNB Housing Fixed deposit.

As you accelerate the growth of your funds, your purchasing power increases, making you able to beat inflation rates.


Unlike SIP’s that are affected by market fluctuations, fixed deposits remain unaffected by these factors. In times of a market crash, you do not need to worry because your money is safe in a fixed deposit.

If you have queries regarding returns on your fixed deposit, you can use a fixed deposit calculator to evaluate your returns on the investment.

Even before you start investing, you can determine the return using this calculator. This will clear out your queries and give you a clear picture of your financial state. Thus, you can plan your expenses and savings.

Benefits for Senior Citizens:

When a person deposits money in a savings account, everyone receives the same interest rate regardless of age. But fixed deposits allow senior citizens to earn higher interests on their investment (between 0.25% to 1% per annum).

Senior citizens generally require extra financial support, and FD’s make it possible to enjoy their post-retirement years.

Periodic Interest Payouts:

This is best to plan your regular financial expenses. Especially during the post-retirement years, people wish to periodically have a continuous flow of income to manage everyday expenses. For periodic interest payouts, go for the non-cumulative FD to generate monthly, quarterly, semi-annual or annual payouts.

Promotes the habit of Saving:

An FD does not allow you to withdraw your money before maturity, unlike a savings account. Easy withdrawal enables you to make unnecessary withdrawals, which is detrimental to your ultimate goal of wealth appreciation. Thus, FD’s help you save better.

Tailor to suit your needs:

Savings accounts serve equally for all. Whereas FDs are of many types. You can choose which type of FD you wish to invest in, depending on your needs.

For instance, if you’re a retired employee- periodic payouts would help you enjoy financial freedom. You can opt for a systematic deposit plan if you want to deposit monthly instead of investing a lump sum amount.

You can look for the wide range of options available among the PNB Housing Fixed deposit plans and choose the best for you at the convenience of your homes with a hassle-free process.

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