In the past few years, several research and studies have indicated that millennials worry about the market volatilities in the stock market. Surveys have shown that 48% of the older millennials invested in equities, and this number went down to just 4% among younger millennials between the ages of 22 and 28. This shows that less affluent millennials preferred investing in fixed deposit, as they offer greater safety, along with assured returns.
Another survey conducted by Tata Capital towards the end of last year found that the post-millennials — or Gen Z, believe in building wealth through investments, with 39 percent of the respondents answering that they invest at least 25 percent of their earnings every month. Among the 1,010 interviewees that took part in the survey, 34 percent answered that they preferred storing away their money in fixed deposits.
These surveys give further credence to the popular belief that younger millennials, especially during times of uncertainty and extreme market swings, prefer parking their money in low-risk options, with fixed deposits being the most popular investment option. With the economic slowdown this year impacting millions of workers in every country, it has become important to start thinking long-term, and start saving money to achieve financial stability.
As per joint report by the International Labour Organization (ILO) and the Asian Development Bank (ADB), 41 lakh youth in India lost their jobs since early March. This report follows the finding that five million salaried people lost their jobs in the month of July alone. Now more than ever, it has become imperative for working professionals to start saving money, and plan for future uncertainties. While investing in the stock market was an attractive proposition in the past, that sentiment has now witnessed a significant shift, with working professionals now opting for low-risk options.
Millennials must set aside a portion of their salary for savings
Bajaj Finance Fixed Deposit offers some of the highest fixed deposit rates, as compared to other NBFCs and traditional banks on average, with flexible tenures ranging from 12 months to 60 months. Investors can also either opt for non-cumulative FDs with periodic payouts, or cumulative FDs, where the maturity proceeds are deposited in the investor’s account directly. One wouldn’t need to worry about the money they invest either, as Bajaj Finance FDs are backed by the highest stability ratings, from two of the largest credit rating agencies in the country, with FAAA (stable) rating by CRISIL, and MAAA (stable) rating by ICRA.
It is important to start thinking long-term, with a long investment horizon when you begin your investment journey. At this moment, fixed deposits offer the dual benefits of safety and assured returns, with an additional rate benefit of 0.10% for non-senior citizens investing online. Additionally, Bajaj Finance fixed deposit scheme allows you to start investing with a lump-sum amount as little as Rs. 25,000, or by depositing Rs. 5,000 every month through the Systematic Deposit Plan (SDP), and investors can choose a tenor that is convenient for them.
Let us assume that you earn Rs. 50,000 per month. Even if you start investing through a Systematic Deposit Plan by putting in Rs. 5,000 (10 percent of your monthly income) every month for 5 years, here is how much you can save in that time (note that you can only make 48 deposits in 5 years).
|Fixed Deposit Type||Investment (Rs.)||Interest (%)||Interest (in Rs.)||Total Payout (Rs.)|
|Non-Senior Citizen (Online)||2,40,000||7.2||99,744||3,39,744|
Alternatively, if you invest Rs. 10,000, Rs. 15,000 or Rs. 20,000 per month through SDPs for five years through 48 deposits, here is the total payout you can expect by the end of the five-year period.
|Fixed Deposit Type||Investment (Rs.)||Interest (%)||Interest Earned per Deposit (Rs.)||Total Interest (Rs.)||Total Payout (Rs.)|
|Non-Senior Citizen (Online)||4,80,000||7.2||4,157||1,99,536||6,79,536|
|Non-Senior Citizen (Online)||7,20,000||7.2||6,235||2,99,280||10,19,280|
|Non-Senior Citizen (Online)||9,60,000||7.2||8,314||3,99,072||13,59,072|
Note: ROI in the above calculator may vary upto 4 bps with the actual rates offered
As the above estimates show, by investing Rs. 20,000 per deposit in Bajaj Finance online FD over five years (48 deposits in total), you can earn almost Rs. 4 lakh in interest alone! Even if you can set aside Rs. 10,000 per month, you can earn Rs. 2 lakh in interest over the five year period, which is a significant amount.
Thus, one can maximize their investments without taking any risks by investing in Bajaj Finance online FD, from the comfort of their home. Given the job uncertainty in today’s market, coupled with the rise in inflation, it is imperative to have a sound financial strategy in place. You can also use the Bajaj Finance FD interest calculator to plan your savings before you invest. You can determine the returns beforehand, and also know your maturity date, and interest payout. Fixed deposits offer greater security, stability, and assured returns, which millennials should prioritize at this time.