Since 1st February 2020, SENSEX and Nifty started to fall with the announcement of the Union Budget and also with the worsening conditions created by disease. Throughout the following days, SENSEX and Nifty continued to lose points owing to the global pandemic that slowed the international market.
On 23rd March, SENSEX fell by close to 4,000 points while Nifty lost around 1,200 points, thereby experiencing the highest weekly loss since 2008 and the lowest since 2016. It is expected that the stock market may face even more losses, considering the stagnation of the economy.
Some economic experts have compared the situation to the stock market crash of 1987. With this crash, investors have lost more than Rs.48 lakh crore in 38 sessions.
As investing in the stock market during these situations will be unwise, individuals can save with the best SDP plans offered by Bajaj Finance.
What is an SDP?
An SDP or Systematic Deposit Plan is a feature of fixed deposits. Systematic Deposit Plans allow individuals to deposit in FDs every month. These plans eliminate the need to deposit a lump sum amount initially, which is the case with standard FDs.
How can Systematic Deposit Plans protect your money during these times?
Systematic Deposit Plans are not market-linked. Hence, this stock market crash will not have any impact on the returns, unlike mutual funds or SIPs. Additionally, Bajaj Finance offers Systematic Deposit Plans that are rated stable by ICRA and CRISIL, thereby guaranteeing their safety and stability.
Assured returns and safety of deposits is what makes these plans the ideal option during this market crash.
What are the other features of a Systematic Deposit Plan?
1. Low Minimum Amount
The minimum amount that individuals can deposit every month is Rs.5,000. Such a small amount makes these plans affordable for those who do not have adequate savings.
2. Competitive Interest Rates
The rate of interest on the best SDP plans starts from 7.6%. An additional 0.25% interest is provided to senior citizens and 0.10% to those renewing their accounts.
Even during this market crash, opting for Systematic Deposit Plans will offer lucrative returns on their deposits.
3. Convenient Short-Term Tenors
Lock-in periods of these plans range between 12 and 60 months. Individuals depositing for longer durations will receive a higher rate of interest. Using an SDP Calculator will help customers to assess the returns based on their selected tenor and deposit amount.
Moreover, depositors can open multiple accounts with different lock-in periods depending on their future financial objectives. For instance, a short tenor will be ideal when individuals seek to purchase a high-value good. On the other hand, a longer tenor will be beneficial if there are plans to host an occasion like a wedding.
4. Multiple Deposit Dates
Customers have the option to choose between multiple dates – 3rd, 7th, and 12th – to make their deposits. However, the deposit date once selected will remain fixed for the entire lock-in period.
5. Loan Against Deposits
Account holders will be able to avail a loan against their Systematic Deposit Plans during financial emergencies. This facility eliminates the need to close the account prematurely.
6. Withdrawal Facility
Along with loans, depositors also get the facility to prematurely withdraw their deposited sum. This facility is available after a deposit completes a period of 3 months.
7. No Penalty Fees for Missed Payments
Customers do not have to pay any penalty if they miss the payment of a particular month. However, they may have to pay a fee for failing to meet the NACH mandate.
8. Only a few Documents Required
The best SDP plans can be started with the following plans –
- PAN.
- Any OVD for KYC (Aadhaar, Passport, Driving License, Voter ID, etc.).
- NACH mandate.
- Account payee cheque.
9. Automated Payments Every Month
The NACH mandate and account payee cheque links the depositor’s account with his or her Systematic Deposit Plan when creating. Thus, payments to be made towards the plan are automatically debited from the individual’s account every month.
10. Options for a Joint Account
Customers have the option to apply for Systematic Deposit Plan jointly with their family members.
Overall, the best SDP plans offered by Bajaj Finance is the ideal savings during this stock market crash. Systematic Deposit Plans are particularly beneficial for those who have just started working and have limited savings. Such individuals can save without any concern as these plans don’t carry any risk.
