It is that time of the year when we have to look into our finances, restructure our investments, audit our savings, and think hard about diversifying our portfolio risk. No such question is one of the most stressful parts of building a financial plan by understanding which instruments can fulfil our needs and requirements.

 And the fact that almost every person has some form of financial advice for you does not help the cause. However, thanks to the internet, you can now make an informed decision easily with the help of the guidance and tips available.

While there are mostly tailored investments depending upon our needs, wants, and goals, a few other financial instruments are equally essential for every portfolio. And one such plan is to have a Fixed Deposit (FD). However, while a lot has been mentioned about this traditional investment, it still stands out as one of the most innovative choices that need to be in your investment. It can be either you wish to have a long-standing investor in FDs or by contemplating about taking this step.

And, here are five reasons why you should always take the leap:

The risk arbitrage: When it comes to fixed deposits, they are one of the safest investment options. And especially when you want to compare them with stocks or any other market-linked instruments. With the help of low volatility, the corpus you have set aside in FDs often serves as a great way to ensure that your capital is safe. However, if you are just exploring different investment options, investing the same amount as your capital is straightforward. It will help you to arbitrage your risks and receive an assured amount at maturity.

The security of Fixed Deposits: When it comes to, in addition to the low risk of the actual products, the safety of the funds can also be easily assessed based on the ratings that are provided by companies like CRISIL.

And, in the FAAA (F Triple-A), the security level has the highest rating for financial instruments. It indicates that the payment of interest and principal is robust. However, when you are looking for FD products with CRISIL ratings of ‘FAAA’ also offers one of the highest FD interest rates, it is an excellent way of balancing your funds out without curbing your returns.

For The Best of Your Interest: When it comes to Fixed Deposits, returns are considered one of the main aspects most people focus on. With the help of recent market developments, the interest rates have been rising, and now is a great time to invest in an FD.

However, to add to this, the right of the FD product is bound to help you get more out of your investment. For instance, PNB Housing Finance FD. With the help of a CRISIL Rating of FAAA or Negative, the FD can easily offer up to an 8.7% interest rate by making it a  brilliant way to get impressive returns on your funds.

Power of Compounding: You can quickly begin early and also multiply wealth with the power of compounding. A small amount can also turn into something more significant with compounding. The compounded interest is reinvested with the principal amount that ranges from 6 months to 10 years fixed deposit. PNB Housing generally offers a 10 years fixed deposit scheme, which is rarely available in the market.

However, with the help of a cumulative fixed deposit, it is suitable for those who do not require any regular interest payment. The interest is paid at the time of maturity in addition to the principal. In a cumulative fixed deposit, the schemes or compounding can also be known as money multiplier schemes. And, on the contrary, in a non-cumulative fixed deposit scheme, the interest is payable at fixed frequencies.

The added benefits: In addition to all this, there are several other benefits of having FDs in your investment portfolio. And, some FDs like that of PNB Housing Finance come with loan facilities that can provide you easy access to funds at the time of emergencies. PNB Housing Finance’s Fixed Deposits offer a loan facility of up to 75% of deposits available from all PNB Housing Branches by ensuring that your FD also has your back in case of any uncertainties.

And, whether you are looking for a security, surety or just sheer comfort of returns and benefits, fixed deposits fit in all your needs by making them a must-have for every type of investor. However, the most universal nature of this instrument will make sure that it can serve a different purpose for every type of investor. If you are a high-risk investor, who is just looking to cap your invested capital, or if you have a lower risk appetite and want a secure and safe way of earning more returns.