Fixed deposits vs real estate: Which is worth, buying land or FD in bank? (2024)

Fixed deposits vs real estate: Which is worth, buying land or FD in bank?

The age-old investing dilemma pits the potential for large profits on real estate against the stability and safety of fixed deposits (FDs). Depending on your particular financial goals and risk tolerance, both choices have advantages and disadvantages. Using shovels and magnifying glasses, let's dissect it and uncover the hidden treasures beneath every investment path.

You may also read: Ayodhya - The Booming Real Estate Market in 2024

You may also read: Top 10 2BHK Projects in Greater Noida

Fixed Deposits: The Certain Heaven

Envision a tranquil garden that is consistently maintained by guaranteed interest rates. That is the FD world. Put your funds in a fixed term investment, and presto! Reliable profits mature with maturity. What makes FDs a gardener's dream is this:

1. Guaranteed returns: Fixed-rate bonds (FDs) provide a stable, pre-set interest rate, in contrast to the volatile nature of stock markets. You invest knowing exactly what to expect come harvest time, which gives you peace of mind.

2. Low risk: FDs are a refuge for investors who are risk averse because they are backed by government insurance. You may rest easy knowing that your valuable investment is securely stored.

3. Liquidity: Do you require a quick boost of cash? The majority of FDs permit early withdrawals, albeit at a little cost. It's easier to get your money back than when you sell a house.

4. Minimal management: Just put your money in a savings account and watch it grow. No need for market research, tenant problems, or property upkeep. This investment is made automatically.

Real Estate: A Possible Goldmine, but Not Without Risks

Now enter the colourful, if occasionally perilous, world of real estate. Although the terrain here demands talent and perseverance to navigate, the rich soil promises abundant harvests.

1. Greater returns: Compared to FDs, real estate investments, owning land or property may yield larger yields. With the right flipping strategy, property appreciation, and rental income, your investment can become a financial haven.

2. Tangible asset: Real estate offers a tangible asset you can see, touch, and even live in, in contrast to the transient nature of financial products. Many investors connect with this sense of ownership.

3. Protect your purchasing power by investing in real estate, which generally grows in value in tandem with inflation. It is therefore a useful safeguard against growing expenses.

4. Hedge Against Inflation: Real estate is a good hedge against inflation, as property values tend to rise along with the cost of living. This means that your investment will become more valuable over time, even if the rupee loses purchasing power.

You may also read: Godrej Top 10 Luxurious Residential Projects in Mumbai

Conclusion

In conclusion, there is no universally applicable solution to the FD vs. real estate controversy. Examine your financial objectives in detail, determine your level of risk tolerance, and select the course that will lead to a profitable future. And never forget that you can find the investment gem that best suits your needs with a little bit of well-informed intuition combined with meticulous planning.

You may also read: Top 7 Apartments in Golf Course Extension Road Gurgaon

You may also read: Top Commercial Projects in Noida by M3M India

You may also read: Top Residential Projects in India to Invest in 2023

You may also read: Top Christmas Home Decor Ideas for 2023

You may also read: Top Commercial Projects in India in 2023

You may also read: Top 10 International Destinations To Celebrate New Year

You may also read: Lakshadweep - The Hottest Tourist destination in India this Year

Fixed deposits vs real estate: Which is worth, buying land or FD in bank? (2024)

FAQs

Is fixed deposit better than real estate? ›

Real estate has more to offer you if you invest with significant gains. However, if you're looking for guaranteed returns, then choose FD.

Is it better to keep money in the bank or buy property? ›

Keeping your money in the bank is considered a low-risk investment strategy. Unlike investing in assets such as stocks or real estate, where the value can fluctuate significantly, bank deposits are generally stable and less susceptible to market volatility.

View Details ›

Is it better to have land or money? ›

While real estate is more lucrative over time than holding cash, it has more risk. On the other hand, holding onto money or putting it into something safe like a CD or savings account might earn smaller yields, but you have less chance of losing it altogether. Luckily, you don't need to choose just one place to invest!

Discover More Details ›

Why fixed deposits are not good? ›

The interest rate on a fixed deposit, however, typically tends to be less than the rate of inflation in most circ*mstances. According to Khandare, it is not a good idea to invest in fixed deposits if they don't provide returns that outpace inflation because they won't be able to keep up with rising living expenses.

What is better investment than real estate? ›

The pros. Stocks are highly liquid. While investment cash can be locked up for years in real estate, the purchase or sale of public company shares can be done the moment you decide it's time to act. Unlike real estate, it's also easier to know the value of your investment at any time.

View Details ›

What investments are better than property? ›

In summary, while property and stocks are both popular investment options, they have significant differences that investors must evaluate based on their financial goals and risk tolerance. For stable, long-term income, property may be preferable; for short-term, high-growth potential, stocks could be the better choice.

Is buying land in cash a good investment? ›

Paying cash for raw land is a great way to be competitive with your offer and save money in the long-term. An all-cash purchase certainly has its benefits – a quick closing, a seller more likely to accept your offer, and you don't have to wait on appraisers, attorneys, lenders, etc.

Read On ›

How much money should you have in your bank account to buy a house? ›

A good number to shoot for when saving for a house is 25% of the sale price to cover your down payment, closing costs and moving expenses. (This amount is separate from saving up 3–6 months of your typical living expenses in a fully-funded emergency fund—which I recommend you do first, before saving up for a home.)

Find Out More ›

What is the best bank to use for investment property? ›

Best Banks for Real Estate Investors

Baselane: Best for free landlord banking, built-in automated bookkeeping, and CRE loan products.
Chase: Best for CRE multifamily lenders with business checking and credit cards.
Bluevine: Best for small business line of credit with interest-earning checking accounts.

More items...

Is buying land only a good investment? ›

Land in California is an investment! Property taxes are relatively minimal, and maintenance is low. Since many individuals are looking to relocate to more rural locations due to the pandemic, there is a significant increase in demand for land, houses, or rentals in these places.

Why is buying land better than a house? ›

You don't need to pay utility bills, mortgages, or roof repairs and replacements. Another advantage is the owner of the land doesn't need to pay for the insurance. Property taxes are the cheapest, so your property doesn't demand unexpected costs and silently increases in value.

Get More Info ›

What is better than a fixed deposit? ›

Public Provident Fund (PPF) PPF is a government-backed long-term investment option for risk-averse investors to earn fixed interest rates decided every quarter by the Finance Ministry. The minimum tenure of a PPF account is 15 years, extendable in blocks for five years after that.

View Details ›

What is the disadvantage of a fixed deposit account? ›

Limited Access to Funds: While deposit accounts offer liquidity, there might be restrictions on the number of withdrawals or transactions allowed. Interest Rate Fluctuations: Fixed interest rates on certain deposit accounts may not keep pace with inflation or changing market rates.

View Details ›

How much amount of FD is safe in a bank? ›

Your investment in a bank is insured under the Deposit Insurance and Credit Guarantee Corporation (DICGC) scheme, which covers your deposits up to Rs. 1 lakh for both principal and interest amount held in the same capacity and same right. So, even if the bank goes insolvent, your fd investment will be safe.

See Details ›

Is fixed deposit a better investment? ›

A perfect tool to invest in if you have certain financial goals to fulfil in a stipulated time frame. It is one of the safest investment options available to date. Here the investor need not worry about losing the capital at all.

See Details ›

Which type of deposit is best? ›

Fixed Deposit Account

If money is deposited in a savings bank account, banks allow a lower rate of interest. Therefore, money is deposited in a fixed deposit account to earn interest at a higher rate. This type of deposit account allows the deposit to be made of an amount for a specified period.

Get More Info Here ›

What are the cons of fixed term deposit? ›

If all your funds are locked away in a Term Deposit, and you need to access cash before the term ends, you will likely not receive the full benefit of the interest earned, and could incur additional costs or having to pay back previously accumulated interest to the financial institution.

View Details ›

Is it good to keep money in fixed deposit? ›

Fixed deposits are generally considered a good saving option when interest rates rise. This is because fixed deposit rates move in tandem with interest rates. As interest rates rise, so do fixed deposit rates. Fixed deposits are also attractive during market fluctuations because of their reliability.

Discover More Details ›