SBI customers who want to earn on regular basis every month can invest in SBI Annuity Deposit Scheme. Under this scheme, the customers get the same interest as the customers of term deposits. Accordingly, you must be wondering that what is the difference between SBI Fixed Deposit (SBI FD) and SBI Annuity Scheme? You must think the work of both is same. but it’s not like that. The biggest difference between both the schemes is the disbursal of the maturity amount.

In SBI Fixed Deposit, the customer has to deposit money once and withdraw in one go or get maturity money in one go. On the contrary, in SBI annuity plan, the customer may deposit money in one go, but he can withdraw money at fixed intervals during the period of his choice. On this basis, the customer gets an opportunity to earn on a regular basis. In the annuity scheme, the customer gets the money every month just like EMI.

Difference between Fixed Deposit and Annuity

On the basis of the need of the customer, it will be decided whether SBI Fixed Deposit is good or SBI Annuity Scheme. If after a few years you need a lump sum amount, such as for the education of a child or for marriage, then SBI Fixed Deposit is more suitable. Conversely, if you want to earn for everyday expenses like EMI every month after retirement, then the annuity scheme will be right. As SBI says, in an annuity scheme, money is given to the customer every month in the form of EMI, in which both the principal and interest are shared. In the annuity, money will continue to be deposited in your bank account on the last date of the month.

Benefits of SBI FD

The biggest advantage of SBI Fixed Deposit is that you have to deposit money in lumpsum amount at a time, but when the scheme matures, a huge amount gets deposited in your account. The biggest advantage in Fixed Deposit is this maturity amount. You can use this money for some big work. On the other hand, nothing is available in the form of maturity amount in annuity but a fixed income every month.

SBI Annuity Benefits

Suppose you need Rs 1,000 per month for 5 years, then you need to deposit at least Rs 60,000 in SBI annuity scheme. The same money will continue to be deposited every month in your account as EMI after 5 years. You can also take annuity scheme through internet banking. You can transfer funds from your account for the annuity scheme.

In the annuity scheme, the subscriber gets the same interest as the interest on the term deposit. The return in annuity also depends on the number of years for which the scheme is taken. Keep in mind that interest earned in annuity is subject to TDS.

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PF account holders can get great happiness. The EPF Board has recently reduced the EPF rate from 8.5 per cent to 8.1 per cent for the 2021-22 financial year, which is being heavily criticized. EPF is now planning to give higher returns to its investors. Actually, the EPFO ​​board can take a decision on increasing the investment limit in the stock market.

Board can decide

It is worth noting that on July 29 and 30, 2022, the meeting of the EPFO ​​​​board is going to be held in which the proposal to increase the existing limit of investment in the stock market and related products from 15 percent to 20 percent can be approved. If the EPF board takes this decision, then investors will get more returns than investing in the stock market.

Government can announce

In a written reply to a question in the Lok Sabha, Minister of State for Labor and Employment Rameshwar Teli said, “The FIAC, a sub-committee of the CBT, has recommended raising the equity and equity related investment limit from 5-15 per cent to 5-20 per cent.” However, let us tell you that trade unions have been opposing the increase in the investment limits of EPFO ​​in the stock market. The government believes that there is no government guarantee on this investment, due to which investors may have to suffer losses.

Up to 20 percent investment in equity possible

Significantly, the Finance Investment and Audit Committee of EPFO ​​has approved the proposal to increase the limit of investment in the stock market to 20 percent. At present, the EPFO ​​invests only 5 to 15 per cent of its funds through Exchange Traded Funds (ETFs). Actually, this time EPFO ​​has got a return of 16.27 percent in 2021-22 from investment in equity, which was 14.67 percent in 2020-21. EPFO has invested in Nuclear Power Bonds for 15 years, on which an interest of 6.89 percent will be paid annually. At present, interest from 7.27 percent to 7.57 percent is being available on Central Government and State Government bonds. Obviously, EPFO ​​is getting low returns on investment in government bonds to corporate bonds.

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