Your bonus strategy is backwards (RD vs stocks comparison)

When your bonus lands, most people think safety first — a recurring deposit locked in for one year. You know exactly what you'll get: no surprises, no volatility.

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But stocks and equity mutual funds over the same one year can historically deliver higher average returns — assuming market conditions remain normal. The catch? Your money isn't guaranteed, and you might see dips along the way.

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A recurring deposit at today's rates gives you roughly five to six percent annually. Locked, predictable, but your rupee's purchasing power erodes with inflation every year.

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A balanced equity mutual fund, based on historical ten-year performance, has averaged returns in the ten to twelve percent range — but that's not guaranteed, and you can withdraw anytime if you need cash urgently.

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The real question: do you need that bonus in one year, or can you stay invested for three to five years? Timeline matters more than the product itself.

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