3 risk-free debt instruments with returns above 8% against inflation in 2022

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Generally, whenever the equity market experiences volatility and requires time to correct the underlying prices, debt securities gain popularity. In a turbulent stock market, playing it safe by diversifying your portfolio with risk-free debt securities reduces the risk of potential profitability. To keep consumer price index (CPI) inflation, which hit an 8-year high of 7.79% in April, in check, the central bank is expected to announce another key rate hike in June. , which will lead to a further rise in interest rates. Although banks have started raising interest rates, it is still difficult to generate returns that beat inflation compared to the current scenario. With that in mind, we’ve selected four risk-free debt investments that can provide you with stable, inflation-proof returns of over 8%.

Shriram Transport Finance Recurrent Deposit (RD)

Shriram Transport Finance Company (STFC) offers Recurring Deposit (RD) with a yield of up to 8.50% for debt investors seeking inflation-beating returns. In response to the question “Is it safe to invest in Shriram Transport Finance Recurring Deposits?” Investors should be aware that STFC RD has been rated “FAAA/Stable” by CRISIL, indicating the highest level of deposit security, and “MAA+ with stable outlook” by ICRA, which gives a clear view of the level of credit. . STFC offers an interest rate of 7.03% on recurring deposits with 12-month maturity, 7.12% on RD with 24-month maturity, 8.18% on deposits with 36-month maturity , 8.34% on deposits with a maturity of 48 months and 8.50%. percent on deposits maturing in 60 months, beginning August 1, 2021. This deposit plan is open to resident individuals and HUFs with a minimum deposit of 500 per slice.

Tamil Nadu Power Finance and Infrastructure Development Corporation (TNPFC) DF

The Tamil Nadu Power Finance and Infrastructure Development Corporation (TNPFC) is a public enterprise in Tamil Nadu. Therefore, a discussion of the risks is not necessary at this stage. This government-backed organization offers a fixed deposit system with cumulative and non-cumulative options.

The non-cumulative fixed deposit has a maturity of 2 to 5 years and, as the name suggests, the interest rate, which varies from 7.25% to 8%, is paid monthly, quarterly or annually, and the amount of the deposit is credited to the investor at maturity. Non-cumulative term deposits maturing in 24 months will earn an interest rate of 7.25%, deposits maturing in 36 months will earn an interest rate of 7.75%, deposits maturing in Maturing in 48 months will earn an interest rate of 7.75%, and deposits maturing in 60 months will earn an interest rate of 8%, which is a return above inflation for regular customers.

Senior citizens will benefit from an additional rate of 0.5%. The cumulative FD has a term of 1 to 5 years with an interest rate of 7.25% to 8%. Interest would be compounded quarterly and paid at maturity, as the name suggests. Deposits maturing in 12 months will earn an interest rate of 7%, deposits maturing in 24 months will earn an interest rate of 7.25%, deposits maturing in 36-48 months will earn a interest rate of 7.75%, deposits maturing in 60 months will earn an interest rate of 8%, and seniors will earn an additional 0.50% interest rate on their deposits.

Tamil Nadu Transport Development Finance Corporation Ltd (TDFC) DF

Tamil Nadu Transport Development Finance Corporation Ltd (TDFC) is a wholly owned subsidiary of the Government of Tamil Nadu which offers a fixed deposit system for bond investors with two options: Periodic Interest Payment System (PIPS) and Multiplier System monetary (MMS) (MMS). The minimum deposit amount allowed under the MMS is Rs 50,000, and interest is compounded quarterly at the applicable interest rate and paid at maturity with the principal amount.

The MMS plan has deposit terms ranging from 12 to 60 months, with the company offering a standard rate of 7% and 7.25% for seniors on deposits maturing in 12 months. On MMS FD plans maturing in 24 months, TDFC offers a regular rate of 7.25% and 7.50% for seniors; on MMS FD plans maturing in 36-48 months, TDFC offers a regular rate of 7.75% and 8.25% for seniors. TDFC offers a regular anti-inflation rate of 8.00% and 8.50% to seniors on MMS FD plans maturing in 60 months.

The minimum deposit allowed under the PIPS program is Rs.50,000/-, and interest is paid monthly, quarterly or annually. Regular customers will benefit from a monthly interest rate of 7.75% on PIPS FD with maturities of 36 to 48 months and an interest rate of 8.00% on PIPS FD with maturities of 60 months . Under the PIPS program, regular customers will benefit from a quarterly interest rate of 7.25% on 24-month deposits, 7.75% on 36-48 month deposits and 8.00% on 60 month deposits. Under the PIPS plan, regular customers will receive an annual rate of 7.98% on deposits of 36 to 48 months and an annual rate of 8.24% on deposits of 60 months.

Senior citizens will benefit from a monthly interest rate of 8.25% on deposits of 36 to 48 months and an interest rate of 8.50% on deposits of 60 months. They will benefit from a quarterly rate of 7.50% on 24-month deposits, 8.25% on 36-48 month deposits and 8.50% on 60-month deposits. Under the PIPS scheme, senior residents will benefit from an annual rate of 8.51% on deposits of 36 to 48 months and an annual rate of 8.77% on deposits of 60 months.

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