Question

Difference between cumulative & non cumulative yearly scheme in ncd

Answer 1

Answer:In cumulative fixed deposit, interest is compounded every quarter or year and paid at the time of maturity.

In a non-cumulative FD, interest is paid out monthly, quarterly, half-yearly, or annually, as per the investor’s choice.Suitability:Cumulative FDs help you build a corpus by saving a large amount.Non-cumulative FDs help you earn regular interest payouts for meeting your daily expenses.

Cumulative FDs work best for individuals seeking to save and grow their savings.Non-cumulative FDs work best for pensioners who seek a regular income from their savings.

Explanation: