However, if you put your money in a Public Mutual bond fund, you can expect to get average 4-6% return per year, almost double of FD rates. In addition, you have more liquidity and flexibility because you can liquidate your bond fund and get the cash in few days. Whereas if you withdraw money before the FD maturity, you will get less return.

So, common sense tells us that putting money in a bond fund is definitely better than FD.