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Are Fixed Deposits Still the Safest Way to Grow Money in 2026?

Updated on April 19, 2026 , 332 views

Fixed Deposits (FDs) have long been a go-to investment option for millions of Indians. Known for their safety, predictable returns, and simplicity, FDs are often the first financial product people trust with their hard-earned money.

Fixed Deposits

But with rising inflation, evolving investment options, and greater financial awareness, the question arises - Are Fixed Deposits still the safest way to grow your money? Or are they slowly losing relevance in a changing economy? Let’s dive deep.

What is a Fixed Deposit (FD)?

A Fixed Deposit is a financial instrument provided by banks and NBFCs that offers investors a higher rate of interest than a regular Savings Account, until the given maturity date. You deposit a lump sum amount for a fixed tenure, and the Bank pays interest either periodically or on maturity.

Key features:

  • Fixed interest rate (usually between 5% and 7%)
  • Safe and low-risk
  • Premature withdrawal allowed (with penalties)
  • Taxable interest income

Why FDs are Considered Safe

  • Capital Protection: The principal amount is protected.
  • insurance: Deposits up to ₹5 lakh per individual per bank are insured by DICGC (Deposit Insurance and Credit Guarantee Corporation).
  • Guaranteed Returns: You know upfront how much you will earn.
  • No Market Risk: Not affected by stock market Volatility.

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The Catch: What Most People Overlook

While FDs are undoubtedly safe, they are not always the best way to grow your money. Here’s why:

🔻 1. FDs May Not Beat Inflation

Let’s say:

  • You earn 6% interest on your FD
  • Inflation is at 6.5%
  • Your real return = -0.5% (negative)

Over time, inflation eats into the purchasing power of your money. What ₹1 lakh can buy today, it might not be able to buy 5 years later—even if you've “grown” it in an FD.

📖 Reference: Ministry of Statistics – Inflation Data

2. FD Interest is Taxable

  • FD interest is taxed as per your income slab.
  • If you're in the 30% slab, your post-tax return from a 6.5% FD is just 4.55%
  • This makes it even harder to beat inflation

⚠️ 3. Liquidity Comes With Penalties

You can withdraw an FD before maturity, but you’ll usually lose 0.5%–1% on interest. So it’s not truly flexible.

When FDs Still Make Sense in 2026

Despite these drawbacks, FDs aren’t useless. In fact, they can be an important part of a balanced Portfolio. Use FDs for:

  • Emergency funds (when safety > returns)
  • Short-term goals (6–24 months)
  • Low-risk capital preservation
  • Senior citizens (with higher FD rates and no market risk)

FD Alternatives: Where to Consider Investing Instead

If your goal is long-term wealth creation, here are some alternatives:

Fund Selection Methodology used to find 10 funds

  • Category: Equity
  • AUM Range: 500 to 1000000 Cr
  • Sorted On : 3-year return (high to low)
  • Tags: fcpro
  • No Of Funds: 10

✅ Equity Mutual Funds

  • Potential to beat inflation over 5–10 years
  • Suitable for long-term goals like retirement, home buying
  • Taxed more efficiently (especially under ₹1 lakh LTCG)

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2024 (%)Sub Cat.
DSP World Gold Fund Growth ₹63.5072
↓ -0.36
₹1,7691.836.6113.65026.7167.1 Global
SBI PSU Fund Growth ₹36.4763
↑ 0.08
₹5,8918.910.516.633.22911.3 Sectoral
Invesco India PSU Equity Fund Growth ₹68.85
↓ -0.06
₹1,33565.714.630.727.110.3 Sectoral
LIC MF Infrastructure Fund Growth ₹51.6039
↑ 0.21
₹90512.82.816.529.825.5-3.7 Sectoral
Nippon India Power and Infra Fund Growth ₹374.18
↑ 0.99
₹6,53415.65.914.328.226.2-0.5 Sectoral
DSP India T.I.G.E.R Fund Growth ₹340.756
↑ 1.47
₹4,979147.516.927.826-2.5 Sectoral
Franklin Build India Fund Growth ₹148.762
↑ 0.59
₹2,8588.8311.427.625.53.7 Sectoral
Canara Robeco Infrastructure Growth ₹171.23
↑ 0.53
₹86414.44.815.427.525.40.1 Sectoral
ICICI Prudential MidCap Fund Growth ₹330.02
↑ 1.16
₹6,56910.77.925.327.121.611.1 Mid Cap
Franklin India Opportunities Fund Growth ₹251.385
↑ 1.54
₹7,578-0.2-4.76.927.120.53.1 Sectoral
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 20 Apr 26

Research Highlights & Commentary of 10 Funds showcased

CommentaryDSP World Gold FundSBI PSU FundInvesco India PSU Equity FundLIC MF Infrastructure FundNippon India Power and Infra FundDSP India T.I.G.E.R FundFranklin Build India FundCanara Robeco InfrastructureICICI Prudential MidCap FundFranklin India Opportunities Fund
Point 1Lower mid AUM (₹1,769 Cr).Upper mid AUM (₹5,891 Cr).Bottom quartile AUM (₹1,335 Cr).Bottom quartile AUM (₹905 Cr).Upper mid AUM (₹6,534 Cr).Upper mid AUM (₹4,979 Cr).Lower mid AUM (₹2,858 Cr).Bottom quartile AUM (₹864 Cr).Top quartile AUM (₹6,569 Cr).Highest AUM (₹7,578 Cr).
Point 2Established history (18+ yrs).Established history (15+ yrs).Established history (16+ yrs).Established history (18+ yrs).Established history (21+ yrs).Established history (21+ yrs).Established history (16+ yrs).Established history (20+ yrs).Established history (21+ yrs).Oldest track record among peers (26 yrs).
Point 3Rating: 3★ (upper mid).Rating: 2★ (lower mid).Rating: 3★ (upper mid).Not Rated.Rating: 4★ (top quartile).Rating: 4★ (upper mid).Top rated.Not Rated.Rating: 2★ (bottom quartile).Rating: 3★ (lower mid).
Point 4Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: Moderately High.Risk profile: Moderately High.
Point 55Y return: 26.75% (upper mid).5Y return: 29.04% (top quartile).5Y return: 27.08% (top quartile).5Y return: 25.55% (lower mid).5Y return: 26.19% (upper mid).5Y return: 25.97% (upper mid).5Y return: 25.51% (lower mid).5Y return: 25.39% (bottom quartile).5Y return: 21.65% (bottom quartile).5Y return: 20.48% (bottom quartile).
Point 63Y return: 49.95% (top quartile).3Y return: 33.22% (top quartile).3Y return: 30.74% (upper mid).3Y return: 29.85% (upper mid).3Y return: 28.23% (upper mid).3Y return: 27.79% (lower mid).3Y return: 27.60% (lower mid).3Y return: 27.51% (bottom quartile).3Y return: 27.12% (bottom quartile).3Y return: 27.11% (bottom quartile).
Point 71Y return: 113.60% (top quartile).1Y return: 16.64% (upper mid).1Y return: 14.64% (lower mid).1Y return: 16.53% (upper mid).1Y return: 14.32% (bottom quartile).1Y return: 16.88% (upper mid).1Y return: 11.44% (bottom quartile).1Y return: 15.35% (lower mid).1Y return: 25.33% (top quartile).1Y return: 6.95% (bottom quartile).
Point 8Alpha: 1.04 (upper mid).Alpha: -1.15 (bottom quartile).Alpha: -6.00 (bottom quartile).Alpha: 2.02 (top quartile).Alpha: -0.88 (bottom quartile).Alpha: 0.00 (upper mid).Alpha: 0.00 (lower mid).Alpha: 0.00 (lower mid).Alpha: 8.43 (top quartile).Alpha: 0.83 (upper mid).
Point 9Sharpe: 2.16 (top quartile).Sharpe: 0.27 (upper mid).Sharpe: 0.01 (upper mid).Sharpe: -0.01 (lower mid).Sharpe: -0.19 (bottom quartile).Sharpe: -0.01 (lower mid).Sharpe: -0.11 (bottom quartile).Sharpe: 0.01 (upper mid).Sharpe: 0.37 (top quartile).Sharpe: -0.41 (bottom quartile).
Point 10Information ratio: -0.83 (bottom quartile).Information ratio: -0.31 (bottom quartile).Information ratio: -0.79 (bottom quartile).Information ratio: 0.34 (upper mid).Information ratio: 0.38 (upper mid).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (lower mid).Information ratio: 0.42 (top quartile).Information ratio: 1.29 (top quartile).

DSP World Gold Fund

  • Lower mid AUM (₹1,769 Cr).
  • Established history (18+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: High.
  • 5Y return: 26.75% (upper mid).
  • 3Y return: 49.95% (top quartile).
  • 1Y return: 113.60% (top quartile).
  • Alpha: 1.04 (upper mid).
  • Sharpe: 2.16 (top quartile).
  • Information ratio: -0.83 (bottom quartile).

SBI PSU Fund

  • Upper mid AUM (₹5,891 Cr).
  • Established history (15+ yrs).
  • Rating: 2★ (lower mid).
  • Risk profile: High.
  • 5Y return: 29.04% (top quartile).
  • 3Y return: 33.22% (top quartile).
  • 1Y return: 16.64% (upper mid).
  • Alpha: -1.15 (bottom quartile).
  • Sharpe: 0.27 (upper mid).
  • Information ratio: -0.31 (bottom quartile).

Invesco India PSU Equity Fund

  • Bottom quartile AUM (₹1,335 Cr).
  • Established history (16+ yrs).
  • Rating: 3★ (upper mid).
  • Risk profile: High.
  • 5Y return: 27.08% (top quartile).
  • 3Y return: 30.74% (upper mid).
  • 1Y return: 14.64% (lower mid).
  • Alpha: -6.00 (bottom quartile).
  • Sharpe: 0.01 (upper mid).
  • Information ratio: -0.79 (bottom quartile).

LIC MF Infrastructure Fund

  • Bottom quartile AUM (₹905 Cr).
  • Established history (18+ yrs).
  • Not Rated.
  • Risk profile: High.
  • 5Y return: 25.55% (lower mid).
  • 3Y return: 29.85% (upper mid).
  • 1Y return: 16.53% (upper mid).
  • Alpha: 2.02 (top quartile).
  • Sharpe: -0.01 (lower mid).
  • Information ratio: 0.34 (upper mid).

Nippon India Power and Infra Fund

  • Upper mid AUM (₹6,534 Cr).
  • Established history (21+ yrs).
  • Rating: 4★ (top quartile).
  • Risk profile: High.
  • 5Y return: 26.19% (upper mid).
  • 3Y return: 28.23% (upper mid).
  • 1Y return: 14.32% (bottom quartile).
  • Alpha: -0.88 (bottom quartile).
  • Sharpe: -0.19 (bottom quartile).
  • Information ratio: 0.38 (upper mid).

DSP India T.I.G.E.R Fund

  • Upper mid AUM (₹4,979 Cr).
  • Established history (21+ yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: High.
  • 5Y return: 25.97% (upper mid).
  • 3Y return: 27.79% (lower mid).
  • 1Y return: 16.88% (upper mid).
  • Alpha: 0.00 (upper mid).
  • Sharpe: -0.01 (lower mid).
  • Information ratio: 0.00 (upper mid).

Franklin Build India Fund

  • Lower mid AUM (₹2,858 Cr).
  • Established history (16+ yrs).
  • Top rated.
  • Risk profile: High.
  • 5Y return: 25.51% (lower mid).
  • 3Y return: 27.60% (lower mid).
  • 1Y return: 11.44% (bottom quartile).
  • Alpha: 0.00 (lower mid).
  • Sharpe: -0.11 (bottom quartile).
  • Information ratio: 0.00 (lower mid).

Canara Robeco Infrastructure

  • Bottom quartile AUM (₹864 Cr).
  • Established history (20+ yrs).
  • Not Rated.
  • Risk profile: High.
  • 5Y return: 25.39% (bottom quartile).
  • 3Y return: 27.51% (bottom quartile).
  • 1Y return: 15.35% (lower mid).
  • Alpha: 0.00 (lower mid).
  • Sharpe: 0.01 (upper mid).
  • Information ratio: 0.00 (lower mid).

ICICI Prudential MidCap Fund

  • Top quartile AUM (₹6,569 Cr).
  • Established history (21+ yrs).
  • Rating: 2★ (bottom quartile).
  • Risk profile: Moderately High.
  • 5Y return: 21.65% (bottom quartile).
  • 3Y return: 27.12% (bottom quartile).
  • 1Y return: 25.33% (top quartile).
  • Alpha: 8.43 (top quartile).
  • Sharpe: 0.37 (top quartile).
  • Information ratio: 0.42 (top quartile).

Franklin India Opportunities Fund

  • Highest AUM (₹7,578 Cr).
  • Oldest track record among peers (26 yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderately High.
  • 5Y return: 20.48% (bottom quartile).
  • 3Y return: 27.11% (bottom quartile).
  • 1Y return: 6.95% (bottom quartile).
  • Alpha: 0.83 (upper mid).
  • Sharpe: -0.41 (bottom quartile).
  • Information ratio: 1.29 (top quartile).
*Some of the Best equity funds are listed above sorted on last 3 year CAGR returns.

✅ Debt Mutual Funds

  • Slightly more risk than FDs, but better post-tax returns
  • Suitable for medium-term goals
  • Indexation benefits if held for 3+ years

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
PGIM India Credit Risk Fund Growth ₹15.5876
↑ 0.00
₹390.64.48.43 5.01%6M 14D7M 2D
Axis Credit Risk Fund Growth ₹22.6819
↑ 0.00
₹35123.27.47.78.78.82%2Y 4M 20D3Y 4M 6D
Aditya Birla Sun Life Savings Fund Growth ₹576.451
↓ 0.00
₹19,3481.736.67.37.47.45%5M 26D7M 2D
Aditya Birla Sun Life Money Manager Fund Growth ₹389.351
↑ 0.05
₹28,7781.83.16.57.47.47.38%9M 4D9M 4D
PGIM India Low Duration Fund Growth ₹26.0337
↑ 0.01
₹1041.53.36.34.5 7.34%6M 11D7M 17D
PGIM India Insta Cash Fund Growth ₹356.883
↑ 0.04
₹6501.73.26.26.96.55.89%1M 3D1M 6D
Indiabulls Liquid Fund Growth ₹2,650.97
↑ 0.24
₹1621.73.26.26.96.67.48%
JM Liquid Fund Growth ₹74.7283
↑ 0.01
₹2,5671.73.16.16.86.46.07%1M 5D1M 8D
PGIM India Short Maturity Fund Growth ₹39.3202
↓ 0.00
₹281.23.16.14.2 7.18%1Y 7M 28D1Y 11M 1D
UTI Banking & PSU Debt Fund Growth ₹22.9695
₹1,1161.72.56.17.17.86.87%1Y 18D1Y 1M 20D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 21 Jan 22

Research Highlights & Commentary of 10 Funds showcased

Commentary PGIM India Credit Risk FundAxis Credit Risk FundAditya Birla Sun Life Savings FundAditya Birla Sun Life Money Manager Fund PGIM India Low Duration Fund PGIM India Insta Cash FundIndiabulls Liquid FundJM Liquid Fund PGIM India Short Maturity FundUTI Banking & PSU Debt Fund
Point 1Bottom quartile AUM (₹39 Cr).Lower mid AUM (₹351 Cr).Top quartile AUM (₹19,348 Cr).Highest AUM (₹28,778 Cr).Bottom quartile AUM (₹104 Cr).Upper mid AUM (₹650 Cr).Lower mid AUM (₹162 Cr).Upper mid AUM (₹2,567 Cr).Bottom quartile AUM (₹28 Cr).Upper mid AUM (₹1,116 Cr).
Point 2Established history (11+ yrs).Established history (11+ yrs).Established history (23+ yrs).Established history (20+ yrs).Established history (18+ yrs).Established history (18+ yrs).Established history (14+ yrs).Oldest track record among peers (28 yrs).Established history (23+ yrs).Established history (12+ yrs).
Point 3Top rated.Rating: 5★ (top quartile).Rating: 5★ (upper mid).Rating: 5★ (upper mid).Rating: 5★ (upper mid).Rating: 5★ (lower mid).Rating: 5★ (lower mid).Rating: 5★ (bottom quartile).Rating: 5★ (bottom quartile).Rating: 5★ (bottom quartile).
Point 4Risk profile: Moderate.Risk profile: Moderate.Risk profile: Moderately Low.Risk profile: Low.Risk profile: Moderate.Risk profile: Low.Risk profile: Low.Risk profile: Low.Risk profile: Moderate.Risk profile: Moderate.
Point 51Y return: 8.43% (top quartile).1Y return: 7.37% (top quartile).1Y return: 6.58% (upper mid).1Y return: 6.52% (upper mid).1Y return: 6.30% (upper mid).1Y return: 6.24% (lower mid).1Y return: 6.24% (lower mid).1Y return: 6.14% (bottom quartile).1Y return: 6.08% (bottom quartile).1Y return: 6.05% (bottom quartile).
Point 61M return: 0.27% (bottom quartile).1M return: 0.80% (top quartile).1M return: 0.67% (lower mid).1M return: 0.81% (top quartile).1M return: 0.47% (bottom quartile).1M return: 0.76% (upper mid).1M return: 0.72% (upper mid).1M return: 0.71% (lower mid).1M return: 0.43% (bottom quartile).1M return: 0.72% (upper mid).
Point 7Sharpe: 1.73 (upper mid).Sharpe: 1.30 (lower mid).Sharpe: 1.95 (upper mid).Sharpe: 1.42 (lower mid).Sharpe: -1.66 (bottom quartile).Sharpe: 2.92 (top quartile).Sharpe: 2.65 (top quartile).Sharpe: 2.05 (upper mid).Sharpe: -0.98 (bottom quartile).Sharpe: 0.62 (bottom quartile).
Point 8Information ratio: 0.00 (top quartile).Information ratio: 0.00 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (upper mid).Information ratio: -0.02 (bottom quartile).Information ratio: -0.15 (bottom quartile).Information ratio: -1.47 (bottom quartile).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (lower mid).
Point 9Yield to maturity (debt): 5.01% (bottom quartile).Yield to maturity (debt): 8.82% (top quartile).Yield to maturity (debt): 7.45% (upper mid).Yield to maturity (debt): 7.38% (upper mid).Yield to maturity (debt): 7.34% (upper mid).Yield to maturity (debt): 5.89% (bottom quartile).Yield to maturity (debt): 7.48% (top quartile).Yield to maturity (debt): 6.07% (bottom quartile).Yield to maturity (debt): 7.18% (lower mid).Yield to maturity (debt): 6.87% (lower mid).
Point 10Modified duration: 0.54 yrs (lower mid).Modified duration: 2.39 yrs (bottom quartile).Modified duration: 0.49 yrs (upper mid).Modified duration: 0.76 yrs (lower mid).Modified duration: 0.53 yrs (upper mid).Modified duration: 0.09 yrs (top quartile).Modified duration: 0.00 yrs (top quartile).Modified duration: 0.10 yrs (upper mid).Modified duration: 1.66 yrs (bottom quartile).Modified duration: 1.05 yrs (bottom quartile).

PGIM India Credit Risk Fund

  • Bottom quartile AUM (₹39 Cr).
  • Established history (11+ yrs).
  • Top rated.
  • Risk profile: Moderate.
  • 1Y return: 8.43% (top quartile).
  • 1M return: 0.27% (bottom quartile).
  • Sharpe: 1.73 (upper mid).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 5.01% (bottom quartile).
  • Modified duration: 0.54 yrs (lower mid).

Axis Credit Risk Fund

  • Lower mid AUM (₹351 Cr).
  • Established history (11+ yrs).
  • Rating: 5★ (top quartile).
  • Risk profile: Moderate.
  • 1Y return: 7.37% (top quartile).
  • 1M return: 0.80% (top quartile).
  • Sharpe: 1.30 (lower mid).
  • Information ratio: 0.00 (top quartile).
  • Yield to maturity (debt): 8.82% (top quartile).
  • Modified duration: 2.39 yrs (bottom quartile).

Aditya Birla Sun Life Savings Fund

  • Top quartile AUM (₹19,348 Cr).
  • Established history (23+ yrs).
  • Rating: 5★ (upper mid).
  • Risk profile: Moderately Low.
  • 1Y return: 6.58% (upper mid).
  • 1M return: 0.67% (lower mid).
  • Sharpe: 1.95 (upper mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 7.45% (upper mid).
  • Modified duration: 0.49 yrs (upper mid).

Aditya Birla Sun Life Money Manager Fund

  • Highest AUM (₹28,778 Cr).
  • Established history (20+ yrs).
  • Rating: 5★ (upper mid).
  • Risk profile: Low.
  • 1Y return: 6.52% (upper mid).
  • 1M return: 0.81% (top quartile).
  • Sharpe: 1.42 (lower mid).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 7.38% (upper mid).
  • Modified duration: 0.76 yrs (lower mid).

PGIM India Low Duration Fund

  • Bottom quartile AUM (₹104 Cr).
  • Established history (18+ yrs).
  • Rating: 5★ (upper mid).
  • Risk profile: Moderate.
  • 1Y return: 6.30% (upper mid).
  • 1M return: 0.47% (bottom quartile).
  • Sharpe: -1.66 (bottom quartile).
  • Information ratio: 0.00 (upper mid).
  • Yield to maturity (debt): 7.34% (upper mid).
  • Modified duration: 0.53 yrs (upper mid).

PGIM India Insta Cash Fund

  • Upper mid AUM (₹650 Cr).
  • Established history (18+ yrs).
  • Rating: 5★ (lower mid).
  • Risk profile: Low.
  • 1Y return: 6.24% (lower mid).
  • 1M return: 0.76% (upper mid).
  • Sharpe: 2.92 (top quartile).
  • Information ratio: -0.02 (bottom quartile).
  • Yield to maturity (debt): 5.89% (bottom quartile).
  • Modified duration: 0.09 yrs (top quartile).

Indiabulls Liquid Fund

  • Lower mid AUM (₹162 Cr).
  • Established history (14+ yrs).
  • Rating: 5★ (lower mid).
  • Risk profile: Low.
  • 1Y return: 6.24% (lower mid).
  • 1M return: 0.72% (upper mid).
  • Sharpe: 2.65 (top quartile).
  • Information ratio: -0.15 (bottom quartile).
  • Yield to maturity (debt): 7.48% (top quartile).
  • Modified duration: 0.00 yrs (top quartile).

JM Liquid Fund

  • Upper mid AUM (₹2,567 Cr).
  • Oldest track record among peers (28 yrs).
  • Rating: 5★ (bottom quartile).
  • Risk profile: Low.
  • 1Y return: 6.14% (bottom quartile).
  • 1M return: 0.71% (lower mid).
  • Sharpe: 2.05 (upper mid).
  • Information ratio: -1.47 (bottom quartile).
  • Yield to maturity (debt): 6.07% (bottom quartile).
  • Modified duration: 0.10 yrs (upper mid).

PGIM India Short Maturity Fund

  • Bottom quartile AUM (₹28 Cr).
  • Established history (23+ yrs).
  • Rating: 5★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 6.08% (bottom quartile).
  • 1M return: 0.43% (bottom quartile).
  • Sharpe: -0.98 (bottom quartile).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 7.18% (lower mid).
  • Modified duration: 1.66 yrs (bottom quartile).

UTI Banking & PSU Debt Fund

  • Upper mid AUM (₹1,116 Cr).
  • Established history (12+ yrs).
  • Rating: 5★ (bottom quartile).
  • Risk profile: Moderate.
  • 1Y return: 6.05% (bottom quartile).
  • 1M return: 0.72% (upper mid).
  • Sharpe: 0.62 (bottom quartile).
  • Information ratio: 0.00 (lower mid).
  • Yield to maturity (debt): 6.87% (lower mid).
  • Modified duration: 1.05 yrs (bottom quartile).
*List of top performing debt funds in India

✅ Public Provident Fund (PPF)

  • 15-year lock-in, but completely tax-free returns
  • Government-backed safety + decent inflation-beating returns

✅ National Pension System (NPS)

  • Long-term retirement corpus
  • Tax benefits under 80CCD(1B)
  • Partial equity exposure + annuity options

✅ RBI Bonds & Tax-Free Bonds

  • Offered by government bodies
  • Safer than corporate Bonds
  • Interest is often tax-efficient

Conclusion: Is an FD Still the Safest Way to Grow Money?

Safety? Yes. Growth? Not necessarily.

FDs still have a place in your portfolio—but only if used strategically. For short-term safety and capital preservation, FDs are great. But if you're looking to build wealth, beat inflation, and optimise taxes, it’s time to explore better options.

Smart Investing = balancing safety, growth, and liquidity.

FAQs

1. Can FDs beat inflation?

A: Not usually. Most FD rates barely match inflation after tax.

2. Is FD interest taxable?

A: Yes. It’s taxed as per your income slab under the old tax regime.

3. Are mutual funds riskier than FDs?

A: Yes, but they have the potential to give higher inflation-adjusted returns over the long term.

About the Fincash Research Team

At Fincash, our mission is to help investors make informed, confident decisions. With over 10 years in Mutual Fund distribution, our team blends deep industry expertise with a commitment to transparency, accuracy, and investor education.

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  • Data specialists processing NAVs, allocations, and risk metrics from Morning Star.

Our Research Process

  • Data sourcing: SEBI-registered fund houses & verified third-party provider Morning Star
  • Screening: Returns, manager track record, expenses, sector mix, risk-adjusted metrics.
  • Expert review: Senior team members review every article and list for accuracy.
  • Updates: Regular refreshes so performance data reflects current market conditions.

Why Trust Us

  • Regulated & compliant: AMFI-registered and MCA-incorporated.
  • Investor-first: No pay-to-promote lists; suitability and performance drive coverage.
  • Education-focused: We simplify complex concepts for everyday investors.

Disclaimer

Content is for educational and informational purposes only and is not investment advice. Please consider your risk profile and consult a financial advisor before investing.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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