ANKIVA ONE
Head-to-Head Comparison

SIP vs FD: Systematic Investment Plan vs Fixed Deposit

Compare the wealth-generation potential of Equity Mutual Fund SIPs against the capital safety of Bank Fixed Deposits.

Option A

Equity Mutual Fund SIP

Disciplined monthly investing for compounding long-term wealth

Expected Yield / Cost:11% - 14% p.a. (Historical Equity CAGR)
Tax Treatment:12.5% LTCG above ₹1.25L exemption (held > 1 yr)
Best Suited For:

Goals 5+ years away (Retirement, Children's Higher Education, Wealth Creation)

Key Advantages
  • 12% to 14% historical annualized returns
  • Beats inflation consistently over 7+ years
  • Tax efficient (12.5% LTCG with ₹1.25L annual exemption)
  • High liquidity without lock-in (except ELSS)
Drawbacks & Risks
  • Subject to short-term market volatility
  • Returns are not guaranteed
Calculate Equity Mutual Fund SIP
Option B

Bank Fixed Deposit (FD)

Guaranteed fixed interest returns with zero market risk

Expected Yield / Cost:6.5% - 7.5% p.a. (Fixed)
Tax Treatment:Fully taxable at slab rate under Other Sources
Best Suited For:

Short-term goals (under 3 years), Emergency Funds, and Senior Citizens seeking steady income

Key Advantages
  • 100% guaranteed principal and interest rate
  • Insured up to ₹5 Lakh by DICGC per bank
  • Predictable cash flow and tenor
  • Zero market volatility
Drawbacks & Risks
  • Low post-tax returns (4.5% - 5.5% in 30% slab)
  • Barely beats or lags real inflation
  • Penalty on premature liquidation
Calculate Bank Fixed Deposit (FD)

The Ankiva One Verdict & Action Plan

For any goal more than 5 years away, Equity SIPs generate 2x to 3x more wealth than FDs. Keep 6 months of emergency living expenses in FDs and invest your monthly surplus in SIPs.

Disclosure: Ankiva One provides free financial calculators and guides. When you apply for products through partner links on our website, we may receive compensation at no extra cost to you. This does not influence our objective calculations.