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SIP and RD are two such schemes in which you can save a good amount for yourself by depositing a fixed amount every month. However, people consider SIP better in terms of profits. Investment is made in mutual funds through SIP and this scheme is market linked. Because of this, returns cannot be guaranteed in SIP. But RD is such a scheme in which you can easily find out how much money you will get on maturity because you already know how much interest you will get in this scheme.
People who prefer safe investments often opt for RD. If you also want to start investing and are confused about whether to invest in RD or SIP, then know here that if you run an RD of Rs 5,000 for 5 years, then how much return will you get and if you invest only that much. If you start a SIP and run it for 5 years, how much return will you get?
On investing Rs 5000 in RD
You get the option of RD in both banks and post offices. RD can be done in banks for 1 to 10 years, whereas in post office, RD scheme is for 5 years, not less and not more than that. If you invest Rs 5,000 in Post Office RD for 5 years, you will get 6.7% interest on it. You will invest Rs 3,00,000 in 5 years and at the rate of 6.7% you will get Rs 56,830 as interest. In this way you will get Rs 3,56,830 after 5 years.
How much benefit will you get from SIP?
Investment in SIP is not guaranteed, but experts consider its average return to be 12 percent. Due to compounding, this amount increases rapidly. In such a situation, if you start a SIP of Rs 5000 for 5 years, then on an investment of Rs 3 lakh, you will get interest of Rs 1,12,432 at the rate of 12 percent and after 5 years, interest of Rs 4,12,432. If seen, it is double as compared to RD. Whereas if the return is more than 12 percent then the return can be more than double.