The year is coming to an end and it’s time to check your score 
2022 was a monumental year when it came to unprecedented global events. There seemed no end to unexpected twists and turns regarding financial markets. The year continued grappling with the COVID-19 pandemic as it started and later witnessed the Russia-Ukraine war, which further constrained the global supply chains and pressured the trade of energy and grains worldwide. Following these events was the ongoing onslaught of the pandemic situation in China and strict lockdown rules. The lockdown situation in China led to further pressuring the global supply chain and trade and commerce worldwide. All these factors led to higher inflation and central banks worldwide resorted to increasing interest rates to rein in the inflation.
With rising interest rates, fixed-income instruments like FDs and debt funds have now become lucrative. The RBI also increased the repo rates for banks in India. As such FD rates have also gone up slightly. It, therefore, makes complete sense to park your funds in FDs and debt instruments rather than speculating on tech or other growth stocks amid rising volatility. In many countries, interest rates are almost peaking and we do not expect further rate hikes in the future (markets expect another 50 bps hike at max in the U.S.). So, now will be a good time to plan your investments. Both debt funds and Fixed deposits have certain advantages. Debt funds are not subject to tax liability and with FDs, the investor gets a guarantee/ surety of up to Rs. 5 lakhs by the government of India in case a bank becomes a defaulter.
Check out our list of leading Banks in India.
Please note interest rates and bond prices are inversely correlated. Currently, corporate bonds are offering a much higher rate amid rising interest rates. You can earn up to 10%-12% in corporate bonds, ~7.5% in Government 10-year bonds, and 7%-9% from debt funds/ bank FDs (depending upon the tenure and age of the investor).
Still looking at buying Gold, check out different ways of buying gold in India.
