FDs or Mutual Funds?
It’s one of the most common questions we get. Let’s break it down:
The Basics
Fixed Deposit (FD)
- Safe & stable
- Fixed returns (currently 6-7%)
- Taxable interest
- Ideal for short-term or low-risk investors
Mutual Funds
- Market-linked
- Higher return potential (8–15% historically in equity)
- Tax-efficient (especially in long term)
- Ideal for medium to long-term goals
Side-by-Side Comparison
Feature | Fixed Deposit | Mutual Fund (Equity/Hybrid) |
Returns | Fixed (6–7%) | Market-linked (8–15%) |
Liquidity | Lock-in period | High liquidity (open-end) |
Taxation | Interest taxed | LTCG taxed after ₹1 lakh |
Safety | Very high | Moderate to high risk |
Flexibility | Rigid | Flexible & goal-based |
So Which is Better?
- Want capital safety for 1–2 years? Go with FDs or Debt Mutual Funds.
- Looking to beat inflation and grow wealth over 5+ years? Choose Equity Mutual Funds or Hybrid Funds.
Pro Tip: Don’t choose just one.
We build portfolios that blend safety with growth—using FDs, debt funds, equity funds, and even gold.
Ready to start a balanced journey?
Let AFIN Capital build a custom investment mix for you.
