When you opt for a fixed deposit (FD), you have to pick a tenure. Usually the tenure can range from seven days and 10 years.(Illustration: Gajanan Nirphale)
When you opt for a fixed deposit (FD), you have to pick a tenure. Usually the tenure can range from seven days and 10 years.(Illustration: Gajanan Nirphale)

How quickly can you withdraw your investments?

In the case of some financial instruments you may have to pay a penalty while for others you may have to wait till a certain tenure.
By HT Correspondent | Hindustan Times, Mumbai
PUBLISHED ON JUL 29, 2019 03:36 PM IST

Have you ever thought about the liquidity for an investment instrument? When you invest your money, usually you will look at the returns. However, it is also important to check about withdrawal.

In the case of some financial instruments you may have to pay a penalty while for others you may have to wait till a certain tenure.

Fixed Deposits and Recurring Deposits

When you opt for a fixed deposit (FD), you have to pick a tenure. Usually the tenure can range from seven days and 10 years. There are two types of bank FDs—with premature withdrawal and without premature withdrawal. The minimum amount you need to invest in FD which give you premature withdrawal option is Rs 1,000. While you can liquidate your FD prematurely and get your money back soon, you have to pay penal interest. In some cases you will not get an interest on your FD while in others you may have to pay 0.50-1% penal interest on your investment. For instance, if you have a 7-day FD, you will not get any interest if you withdraw prematurely. FDS without premature withdrawal option have a higher investment amount and can go up to Rs 1 crore.

Here you cannot close the FD before maturity. However, the bank may allow premature withdrawal of these deposits in exceptional circumstances such as in the event of direction from a statutory or regulatory authority or deceased claim settlement cases. Also any interest credited or paid up to the date of such premature closure will be recovered. If you had invested in tax-saving FDS, you will have a lock-in for five years, which means premature withdrawal can only be done in exceptional cases such as death — and the bank would not pay any interest on the principal amount deposited. Now with net banking and mobile banking, you can get back your FD amount in your bank account faster after you initiate the process. In case of recurring deposit (RD), you invest a certain fixed amount each month for a particular period. On maturity, you get the principal amount and the interest amount in your bank account. But in case of premature withdrawal, like in the case of FDS, the bank calculates interest on the period for which the deposit remained with the bank, and usually charges a penalty between 0.50% and 1% of the RD rate.

Small Savings and Mutual Funds

Do you invest in small savings instruments such as post office time deposits, National Savings Certificate, Public Provident Fund (PPF), Kisan Vikas Patra or Sukanya Samriddhi Account? All of these instruments have different withdrawal processes. In case of PPF, you can prematurely close the account only after the completion of five years, that too in case of medical emergency or higher education. Partial withdrawal in PPF is allowed only after the seventh year. The premature withdrawal comes with a penalty—you will get 1% less interest, as applicable from time to time. For Sukanya Samriddhi accounts, partial withdrawal (50% of the total amount) is allowed when the account holder turns 18, if she needs the money for education or marriage.

Mutual funds are one of the most liquid investments. In the case of regular liquid funds, you can get the money in the T+1 (the day you put your redemption request plus one working day). Some mutual fund houses allow you to withdraw money instantly like you withdraw from an automated teller machine. For equity mutual funds, the settlement period is T+3—it would take three working days to get the money in your account. If you have international equity mutual funds, you can expect 5-10 business days for redemption. In mutual funds, though you don’t have to pay a penalty, you will have to take a closer look at your taxation—shortterm and long-term capital gains tax— before withdrawing your money.

SHARE THIS ARTICLE ON
Close
Digital payments in India could rise to $135.2 billion in 2023, according to an Assocham-PWC India study in 2019.(Bloomberg)
Digital payments in India could rise to $135.2 billion in 2023, according to an Assocham-PWC India study in 2019.(Bloomberg)

Reliance partners with Google, Facebook for digital payment network bid

Reuters, New Delhi
PUBLISHED ON FEB 27, 2021 05:12 PM IST
  • Facebook and Google are already partnered with Reliance and own stakes in Jio Platforms
Close
Its education arm, known as Dali, meaning “big force” in English, was established last year and offers everything from pre-school programs to adult education and smart learning devices.(AP)
Its education arm, known as Dali, meaning “big force” in English, was established last year and offers everything from pre-school programs to adult education and smart learning devices.(AP)

ByteDance to hire 13k new employees, explore China's education technology

Bloomberg
PUBLISHED ON FEB 27, 2021 04:40 PM IST
ByteDance, the owner of the short video app TikTok, said that it will hire 10,000 educational professionals, including tutors and course designers, in China over the next four months,
Close
A neighborhood experiencing a power outage after winter weather caused electricity blackouts in San Marcos, Texas, US on February 16, 2021.(Reuters Photo )
A neighborhood experiencing a power outage after winter weather caused electricity blackouts in San Marcos, Texas, US on February 16, 2021.(Reuters Photo )

Texas’s power market is $1.3 billion short after energy crisis

Bloomberg
PUBLISHED ON FEB 27, 2021 02:31 PM IST
On Friday, the grid operator announced it would cover part of the shortfall with $800 million in congestion revenues, money generated from trading bottlenecks on the grid that is supposed to be returned to consumers.
Close
Following the acquisition of Dynamic Yield, McDonald’s executives called it a central part of the company’s evolving digital strategy.(Reuters)
Following the acquisition of Dynamic Yield, McDonald’s executives called it a central part of the company’s evolving digital strategy.(Reuters)

McDonald's to sell part of its artificial intelligence start-up

Bloomberg
PUBLISHED ON FEB 27, 2021 12:06 PM IST
The company works with other clients besides McDonald’s, and that business has grown since the acquisition and now works with 300 other brands globally.
Close
Mukesh Ambani, chairman and managing director of Reliance Industries. (Reuters File Photo)
Mukesh Ambani, chairman and managing director of Reliance Industries. (Reuters File Photo)

Mukesh Ambani is again richest Asian as China’s Zhong loses $22 billion

Bloomberg
PUBLISHED ON FEB 27, 2021 09:45 AM IST
Ambani spent most of the past two years leading the ranking of Asia’s richest people, taking over from Alibaba Group Holding Ltd.’s Jack Ma.
Close
The fall in gold prices led to buying and a surge of demand across the country.(Reuters)
The fall in gold prices led to buying and a surge of demand across the country.(Reuters)

Weekly wrap: After early surge, gold prices fall for last 3 days

By hindustantimes.com, Hindustan Times, New Delhi
UPDATED ON FEB 27, 2021 09:33 AM IST
  • Gold set off to a brighter start at the beginning of the week as the price of the precious metal went up by 278 to 46,013 per 10 grams on Monday.
Close
The RBI report also suggested changes in the inflation targeting framework for better transparency, accountability and operational efficiency.(REUTERS)
The RBI report also suggested changes in the inflation targeting framework for better transparency, accountability and operational efficiency.(REUTERS)

RBI in favour of retaining inflation target for 5 years

By Gopika Gopakumar, Livemint, Mumbai
PUBLISHED ON FEB 27, 2021 04:47 AM IST
Under India’s flexible inflation targeting (FIT) approach, the central bank is expected to work to maintain retail inflation at 4%, with an upper tolerance limit of 6% and a lower limit of 2%.
Close
The agencies also made the recommendation based on “the nature of China Telecom’s US operations,” which they said allow Chinese government actors “to engage in malicious cyber activity.(Mint)
The agencies also made the recommendation based on “the nature of China Telecom’s US operations,” which they said allow Chinese government actors “to engage in malicious cyber activity.(Mint)

Telecom sector revenues back at pre-Jio levels

By Ishita Guha, Livemint, New Delhi
PUBLISHED ON FEB 27, 2021 04:43 AM IST
According to data released by the Telecom Regulatory Authority of India (Trai), net mobile revenues rose 4.5% sequentially to $25 billion in the December quarter. The last time the sector had earned $25 billion was in April-June of calendar year 2016.
Close
Indian shares fell in line with Thursday’s rout in the US after Treasury yields rose to their highest level in a year.(REUTERS)
Indian shares fell in line with Thursday’s rout in the US after Treasury yields rose to their highest level in a year.(REUTERS)

Indian shares crash as panic grips bond, global markets

By Nasrin Sultana, Livemint, Mumbai
PUBLISHED ON FEB 27, 2021 04:36 AM IST
On Friday, the benchmark Sensex fell 1,939 points, or 3.78%, to 49,099.99, the biggest daily drop since 4 May 2020. The 50-share Nifty index declined 3.78% to 14,529, led by banks and financial services stocks.
Close
To be sure, the Indian economy will still face its largest ever contraction in the current fiscal year.(AP file photo. Representative image)
To be sure, the Indian economy will still face its largest ever contraction in the current fiscal year.(AP file photo. Representative image)

India out of recession as GDP expands 0.4% in Q3

By Roshan Kishore, New Delhi
PUBLISHED ON FEB 27, 2021 02:43 AM IST
India’s gross domestic product (GDP) grew at 0.4% on a year-on-year basis in the quarter ending December 2020, according to data released by the National Statistical Office (NSO) on February 26.
Close
Congress chief spokesperson Randeep Singh Surjewala(PTI)
Congress chief spokesperson Randeep Singh Surjewala(PTI)

'Hit by double whammy of low growth, high inflation': Cong on economy's state 

Edited by Prashasti Singh, Hindustan Times, New Delhi
PUBLISHED ON FEB 26, 2021 10:21 PM IST
The Congress responded to the data and said the government spent a lot less than what was needed to revive the Indian economy.
Close
India's largest stock exchange, NSE announced on Wednesday it shut at 11:40am local time because of a telecoms problem.(MINT_PRINT)
India's largest stock exchange, NSE announced on Wednesday it shut at 11:40am local time because of a telecoms problem.(MINT_PRINT)

India's NSE defends reopening market after exchange's shutdown

Posted by Kunal Gaurav | Reuters, Mumbai
PUBLISHED ON FEB 26, 2021 09:08 PM IST
Brokers had criticised the NSE over the lack of information after the four-hour shutdown on Wednesday.
Close
The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, US.(REUTERS)
The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, US.(REUTERS)

Oil slumps with wider markets, denting record start to 2021

Bloomberg
UPDATED ON FEB 26, 2021 06:52 PM IST
The demand outlook has improved, with traders and investment banks this week making a series of bullish calls and upward price revisions.
Close
There is also another plan at <span class='webrupee'>₹</span>1,499 that offers a JioPhone device, unlimited voice calls and data (2GB high-speed data every month) for one year(Reuters File Photo)
There is also another plan at 1,499 that offers a JioPhone device, unlimited voice calls and data (2GB high-speed data every month) for one year(Reuters File Photo)

Reliance Jio launches new unlimited plans to usher in '2G-mukt Bharat'

ANI, Mumbai
PUBLISHED ON FEB 26, 2021 06:47 PM IST
  • According to the plan, new users will get a JioPhone device, unlimited voice calls and data (2GB high-speed data every month) for two years at 1,999.
Close
The lockdown imposed to curb spreading of coronavirus infections had significantly impacted business activities and in turn contributed to sluggish revenue realisation. (Representative Image)(BLOOMBERG NEWS)
The lockdown imposed to curb spreading of coronavirus infections had significantly impacted business activities and in turn contributed to sluggish revenue realisation. (Representative Image)(BLOOMBERG NEWS)

Fiscal deficit rises to 12.34 lakh crore at end of January

PTI
PUBLISHED ON FEB 26, 2021 06:41 PM IST
The fiscal deficit at the end of January in the previous financial year was 128.5% of the Revised Estimates (RE).
Close
SHARE
Story Saved
OPEN APP