Saturday, March 21, 2009


A Regular Visitor to my blog, Mr.Akhil Sharma wrote :

Hello Sir,
How are you doing?....i again want to congratulate you for the terrific job you are doing.
Coming to the point i wanted to know about Company FDs.I just saw an advertisement of "Tata Motors Fixed Deposit Scheme".It says earn 12.83% per annum on a 3 years deposit.i have just joined my first job and my salary is around 2,10,000.

I along with my mother wanted to invest in a fixed deposit of Rs.50,000.Is this the right option.what will be the Net return after tax.i mean what will i get after 3 years if i invest Rs.50,000 now.
Or should i go for some Bank FD rather than Company FD.

You can check this link if you want.

I want to invest in the cumulative deposit plan!
thanks and regards
Akhil Sharma.
P.S:Thanks for your kind words on my blog Confessions of a delhite!


Hi Akhil sharma,
It is with great pleasure that I recd that the news that you have got your first job. Congrats!!!
I will answer your query later. First of all, I would like you to Insure yourself adequately. For this, you should consider taking Term Insurance as this is the Cheapest form of Insurance available. Only later on, you should think of Investments.
Regarding FDs, as you are young, you are better off investing in Diversified Mutual Funds, which I have already discussed with you earlier. Sure, if you are planning to keep aside the amount for a particular reason, with a fixed time horizon, then go ahead.
For your investment amount of 50000, you should be getting about 62940 after taxes (I have considered you to be in the highest Tax Bracket). If you are in the lower Tax Bracket, you should be getting somewhere around 66400 or so.
With the falling interest rates, the Tata Motors Fixed Deposit Scheme is quite Attractive. Though the Company is going through tough times presently, 3 years is a good enough time for the company to sail through and moreover your investment is secured. So, go ahead and invest but before that, PLEASE NOTE, THAT THE COMPANY OFFERS HALF(1/2) PERCENT EXTRA FOR SHAREHOLDERS. YOU CAN BUY A SMALL LOT OF TATA MOTORS SHARE AND AVAIL A HIGHER RATE ON THE FIXED DEPOSIT!!!!!.
Best of luck,
Srikanth shankar Matrubai

Also visit for an indepth Equity Analysis

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