SDP Guide: The Best Systematic Deposit Plan for 5 Years in India

Systematic Deposit Plans (SDP) is the new savings tool to be explored. This is the first-of-its-kind feature of the regular FD which has been introduced to make high-yielding company fixed deposits accessible to all income groups.

SDP is an easy and simple way to create several monthly FDs in a series and expand stability in your financial portfolio. While you are planning for your future, ensuring your next five years’ financial goals are taken care of will help you assess the need for an SDP.

Economic scenario for the next five years

While no one can exactly predict the economic scenario in the next five years, interest rates are certainly towards a downtrend. This suffices to say that to reap stable returns, it is advisable to create fixed deposits that lock in the best returns for your financial goals for the next five years. The bank fixed deposits are yielding anywhere between 5% to 7.75% for longer durations. This is a very average rate when compared to returns between low government securities and possibly high yielding stocks. However, they are the most stable. Company fixed deposits offer the highest range among all fixed-income investments. Bajaj Finance SDP is a company SDP which offers all the benefits of a company FD.

Choosing the best Systematic Deposit Plan (SDP)

The best SDP plan for 5 years is ideal for investors who are looking to start investing in FD with as less as Rs. 5,000 per month. Bajaj Finance Systematic Development Plan (SDP) helps you to start building a portfolio without straining your salary. You can decide on the tenor between 12 to 60 months. At the same time, it also gives the flexibility to set the number of deposits ranging from 6 to 48 during this tenor.

The best SDP plan for 5 years will allow you the following benefits –

  1. In-built laddering – Each deposit is like a new FD as it is deposited on that day’s interest rate. It gets matured after the tenor you have chosen gets over for each deposit. Thus, the stream of maturity earnings keeps coming in the same way you had made the deposits. This will create an automatic laddering where you will get a steady stream of matured deposits.
  2. High interest – You are assured of high interest rates starting with 8.10% for 3 years cumulative FD (without interim payouts). If you are a senior citizen, you can avail an additional 0.25% and if you an existing customer, you can avail an additional 0.10%.
  3. Calculate your returns in advance- With the SDP Calculator available on Bajaj Finserv website, knowing the maturity amount is easily possible. Just choose the monthly amount you plan to invest in deposits, the number of deposits and tenor. The SDP Calculator will automatically calculate the maturity amount once you enter these values. You can adjust the values using the slider. This can help you understand the various combinations you can make between tenors, deposits and deposit amount to meet your financial goals.
  4. Loan against deposit –You can take a loan against each deposit in the SDP, without affecting the other deposits in the SDP. Similarly, you can go for a premature withdrawal against any deposit in the SDP.

Whether it’s a five year or one-year horizon, SDP is the best deposit plan for gaining steady, high returns.

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