SDP: The Best Monthly Saving Scheme For Middle-Class Families

With growing awareness about
financial planning, individuals, especially those belonging to the
middle-income group are more inclined to proper monetary management today than
before. As a means to achieve it, a large number of individuals now refer to
savings tools such as Systematic Deposit Plans into their financial regime.

Though there are several savings
tools available in the market, the Systematic Deposit Plan can be considered
among the best
monthly saving schemes. The reason for the same can be accredited to the
features which have been formulated to promote savings while generating a
steady income.

The following highlights how this
savings tool facilitates both savings and income generation:

The Systematic Deposit Plan
offered by reputed NBFC Bajaj Finance as an additional with their Fixed
Deposits is a monthly savings tool that requires individuals with a minimum
deposit of only Rs.5,000. The low deposit value is vital for those who do not
have lump sum funds available to initiate the investment. This enables
individuals to jumpstart their savings without straining their available income
and other financial needs.

It directly allows individuals to
put their limited savings to better use and generate a steady income against
it. Resultantly, it is among the best monthly saving schemes for the
middle-income group.

Typically, traditional savings
options offer individuals a fixed return on their monthly savings. On the other
hand, under the Systematic Deposit Plan, each monthly pay-out is regarded as a
different deposit, and hence, attracts a different rate of interest. Now, this
rate of interest largely depends on the rates that are active in the market. In
turn, such a unique feature facilitates the scope of earning higher returns in
a favourable market.

Also, under this savings option,
individuals benefit from guaranteed returns as their deposits are not exposed
to the market-linked risks. This further ensures that even when the financial
conditions are not rewarding, depositors’ revenue would not be in a negative
value. This negligible risk and substantial reward feature further make
Systematic Deposit Plan a viable monthly savings tools for families belonging
to the middle-income group.

This savings option comes with a
maturity period that ranges between 1 and 5 years. Individuals are at liberty
to opt for a maturity period that suits their respective financial goal.
Depending on the estimated time required to reach their financial objective,
individuals can opt for a suitable maturity period and investment sum.

Also, such a scheme allows them
to choose a payment date to ensure that the monthly process of depositing their
savings is convenient and less cumbersome.

In case, individuals find it
challenging to select a suitable tenor, they may use a systematic deposit
calculator to ease the process. With the help of such a financial tool,
individuals would be able to gain a better idea of the maturity value and would
be able to plan their finances better.

Being a monthly savings options,
individuals are required to put aside a fixed sum of money at regular
intervals. By the time the deposits reach their maturity date, individuals
develop a positive attitude towards savings.

Additionally, it helps them to
curtail their unnecessary expenses and monitor them more carefully. On the
whole, it allows depositors to adopt a financial discipline which directly
benefits their financial management practices, crucial for middle-income
groups.

A Systematic Deposit Plan can be
opened by multiple individuals as a joint account, favourable especially for
accessibility to more than one family member. Such a feature not just enables
family members to build a robust corpus with their combined savings but also
allows them to continue earning returns on their deposits cumulatively. Moreover,
it enables account holders to keep their deposit account active even in the
event of the death of their joint holder.

The Systematic Deposit Plan does
not levy any penalty on the depositors when missing any payment. Since accountholders
are not required to pay any extra charges or fine, their financial liability is
significantly reduced. There are also no hidden charges levied.

The liquidity aspect of this
savings tool is one of the most useful features for families belonging to the
middle-income group. To elaborate, such families often do not have the strong
financial backing to fall back on in case of any emergency. However, a
Systematic Deposit Plan can help meet urgent financial requirements.

Individuals are entitled to
withdraw from their deposits prematurely as per the RBI guidelines. Also, they
are permitted to avail a credit against their deposits given they meet the
associated rules. The Systematic Deposit Plan can be prematurely withdrawn
after the completion of 3 months from the date of deposit.

In a nutshell, the high
liquidity, assured and risk-free returns as well as joint account facilities
makes the Systematic Deposit Plan one of the best monthly saving schemes
available in the Indian market. Plan your finances and invest to build a large
corpus for future with minimal monthly deposits.