Bank Accounts provide fund liquidity and safety. They are a popular option to park excess money and see it grow over time. While none are linked to market fluctuations, they guarantee returns and allow you to withdraw funds without imposing a lock-in period, unlike other instruments.
You can maximise returns by investing in high-yield accounts, sweep-in and sweep-out facilities, Certificatesof Deposits,etc. Follow these tips to earn higher Savings Account interest rates and returns:
Find higher interest rates online
Many online platforms provide a decent interest rate than traditional banking methods. You can transfer your money to earn extra interest if you find a credible bank offering a better scheme. Ensure the maintenance or other additional charges do not wipe your savings. Explore options online for better returns.
Utilize idle funds effectively
You can use the sweep-in and sweep-out facility under your Bank Account to generate higher interest income from your idle funds. Your surplus funds get swept out to a Fixed Deposit income that automatically yields a higher return rate. You mayreturn the money to your account if you need urgent cash.
Earn indirectly through regular interest credits
Your bank may provide monthly interest credits to your account. You can use them for other investments if you maintain a decent account balance. For instance, you can invest in Mutual Funds through Systematic Investment Planand deposit monthly interest income. It ensures you use your income to yield higher returns through actively managed schemes.
Consider demography-based accounts
Many banks have specific Savings Accounts for children, senior citizens, etc. They may offer a higher interest rate than a Regular Account. If you have a child below 18, you can open a Minor Account, deposit your money there, and enjoy a higher interest rate on the Savings Account.
Invest in Certificates of Deposit
You can use your savings to invest in Certificates of Deposit, like Fixed Deposits. All scheduled commercial banks in India can issue CDs. They have a tenure of three months to a year. If you do not need the amount, you can reinvest the matured CD and continue to earn higher interest.
Through these tips, you can earn a higher interest income while enjoying the benefits of Savings Accounts. While your income increases, your funds remain in a liquid form. You can accessthese investments from the Banking app and track them from anywhere.
Points to note
Remember that some banks offer the highest Savings Account interest rates to attract customers and increase popularity. These accounts benefit working professionals and retired individuals who need not depend on borrowed money.
Compare savings rates online before choosing the bank. Even a slight increase in the interest rate can see you earn more interest on the money you have saved up over a while.
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