SBI 10-year FD vs SIP: What will be your return on Rs 9,50,000 investment in 10 years
Compare SBI 10-year FD and SIP returns on a Rs 9,50,000 investment. Understand interest rates, potential earnings, and risk factors to choose the best long-term investment option for wealth growth.
Choosing the right investment is crucial for long-term financial growth. SBI offers FDs (fixed deposits) with guaranteed returns, while SIPs (Systematic Investment Plans) in mutual funds provide market-linked growth potential. If you invest Rs 9.5 lakh in an SBI FD for 10 years, you’ll receive fixed returns. Whereas, an SIP of Rs 7,920 per month can offer higher but variable returns.
SBI FD interest rates
SBI offers interest rates ranging from 3.50 per cent to 7.25 per cent per annum for the general public and 4.00 per cent to 7.75 per cent per annum for senior citizens. The SBI Tax Saving Fixed Deposit provides an interest rate of 6.50 per cent for the general public and 7.50 per cent for senior citizens for long-term investments.
FD investment overview
- Invested Amount: Rs 9,50,000
- Estimated Returns: Rs 8,60,281
- Total Value after 10 Years: Rs 18,10,281
SBI fixed deposit options for NRIs
SBI offers multiple FD options for NRIs, including NRO, NRE, RFC, and FCNR (B) deposits. The FCNR (B) deposits are available in USD, GBP, Euro, CAD, AUD, and JPY, while RFC deposits can be made in USD, Euro, and GBP.
What is SIP (Systematic Investment Plan)?
SIP allows investors to invest a fixed amount in mutual funds at regular intervals, reducing market risk and benefiting from rupee cost averaging.
How does SIP work?
- The investment amount is auto-debited from the investor’s bank account at a fixed interval.
- Mutual fund units are allocated based on the Net Asset Value (NAV) of the fund.
- Over time, reinvested returns help in wealth accumulation.
SIP vs One-time investment
Investors can invest in mutual funds in two ways:
- Lump Sum: A one-time investment, such as Rs 1 lakh, in a mutual fund.
- SIP: A fixed monthly investment, such as Rs 500 or more, spread over time.
When should you start an SIP?
SIP investments can be started anytime, but the earlier, the better. Selecting a fund that aligns with your long-term financial goals ensures maximum returns with minimised risk.
SIP investment returns in 10 years
- Monthly Investment: Rs 7,920
- Total Invested Amount: Rs 9,50,400
- Estimated Returns: Rs 8,23,964
- Total Value after 10 Years: Rs 17,74,364
FD vs SIP: Which one should you choose?
- FDs provide fixed returns with low risk, making them ideal for risk-averse investors.
- SIPs offer higher potential returns, but returns are market-dependent.
FD or SIP?
- If you prefer stability and guaranteed returns, FD is the safer choice.
- If you seek higher returns and can handle market fluctuations, SIP is the better option.