₹5 Lakh FD: Monthly Earnings, Tax, & Real Returns Explained

• A ₹5 lakh FD at 7% annual interest yields approximately ₹2,900 monthly before tax.
• FD interest is taxable as per your income tax slab; TDS applies if annual interest exceeds ₹40,000 (general) or ₹50,000 (senior citizens).
• Benefits include capital safety, fixed income, and premature withdrawal flexibility.
• Drawbacks are low real returns due to inflation, tax inefficiency, and limited long-term wealth creation.
• FDs are suitable for safety and fixed income, but balancing with other investments is crucial for growth.

Why It Matters: ₹5 lakh FD offers safety and fixed income, but consider tax, inflation, and diversification for optimal returns.