Earn more with savings account in India
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A savings account is a fundamental tool for managing your finances and achieving your financial goals. In India, most people use savings accounts to store their money, but did you know that you can make your money work harder for you by earning more from your savings account? In this blog post, we’ll explore strategies to help you earn more with savings account in India.
Choose the Right Bank
The first step in earning more with your savings account is to choose the right bank. Not all banks offer the same interest rates on their savings accounts. Some banks provide higher interest rates compared to others. Research and compare the interest rates offered by various banks to find the best deal for your savings.
The following points can be helpful for you to choose the right bank for your need:
- Understand Your Financial Needs
- Fees and Charges
- Online and Mobile Banking
- Interest Rates
- Customer Service
- Branch and ATM Accessibility
- Security and Reputation
Look for High-Interest Savings Accounts
Some banks offer specialized savings accounts with higher interest rates, often referred to as high-interest savings accounts. These accounts may require a higher minimum balance or have certain restrictions, but they can provide significantly higher interest rates compared to regular savings accounts.
The benefits of choosing high-interest savings accounts are like, you will be able to earn more money on your deposits, your money will grow over time, and the liquid access to your money.
Maintain a Healthy Balance
Many banks offer tiered interest rates, meaning that the more money you have in your account, the higher the interest rate you’ll earn. Try to maintain a healthy balance in your savings account to maximize your earnings. It’s essential to keep an eye on the minimum balance requirements to avoid fees.
Utilize Recurring Deposits
Recurring deposit accounts are a great way to earn more with your savings. These accounts allow you to deposit a fixed amount of money at regular intervals. The interest rates on recurring deposit accounts are often higher than regular savings accounts. By setting up a recurring deposit, you can ensure a steady flow of savings and enjoy better returns. Some of the banks offers Recurring Deposits along with your savings account.
The main benefits you can consider of a Recurring deposit account are:
- Guaranteed Returns
- Flexibility and Accessibility
- No Market Risks
Explore Online Savings Accounts
Online savings accounts are gaining popularity in India. These accounts are offered by digital banks and often come with competitive interest rates. They are user-friendly, with easy access through mobile apps or websites, making it convenient to manage your savings.
The main benefits of online savings accounts are:
- Convenience and Accessibility
- Lower Fees
- Higher Interest Rates
- Automatic Savings Features
Opt for Tax-Saving Fixed Deposits
If you’re looking for ways to earn more and save on taxes, consider tax-saving fixed deposits. These come with a lock-in period but offer higher interest rates and the added benefit of tax deductions under Section 80C of the Income Tax Act. They are a great way to grow your savings while reducing your tax liability.
Keep an Eye on Fees and Charges
To maximize your savings, it’s essential to minimize fees and charges associated with your savings account. Ensure that you understand the fees structure of your bank and choose an account with low or no charges for services you regularly use.
Take advantage of rewards offered on debit cards
Many banks offer rewards programs on their debit cards. These programs can give you cash back or points on your purchases, which you can then redeem for merchandise, travel, or other rewards. Some banks also offer bonus rewards for using your debit card at certain merchants or for making certain types of transactions.
Ask for auto sweep facility
The auto sweep facility is a powerful tool for individuals seeking a balance between liquidity and returns. This facility can help you to earn more with savings account. By intelligently managing idle funds, this feature empowers savers to make the most of their money without the need for constant manual intervention.
Imagine your savings account as a gateway to a world of financial opportunities. When the balance in your savings account exceeds a predefined threshold, the surplus amount is automatically transferred to a fixed deposit. This process happens seamlessly in the background, without requiring any intervention from you.
Some of the top banks which provides auto sweep facility are: State Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, etc.
Automate Your Savings
Setting up automatic transfers from your primary account to your savings account can ensure that you consistently save a portion of your income. This method helps you build your savings without the risk of spending it.
Try and open two or more savings accounts
If you have a large amount of money to save, you may want to consider opening two or more savings accounts. This will allow you to take advantage of different interest rates and features from different banks which will definitely let you earn more with savings account.
Here are some additional tips for earning more with your savings account in India:
- Avoid withdrawing money from your savings account too often. Each time you withdraw money, you reset the interest accrual period.
- If you need to withdraw a large amount of money, consider doing so from a fixed deposit instead of your savings account. FD rates are typically higher than savings account rates, so you won’t lose out on as much interest.
- Keep an eye on interest rates and switch banks if you find a better deal. Many banks offer sign-up bonuses to new customers, so you may be able to earn a significant amount of interest in the first few months of opening a new account.
End note on Earn More with Savings Account
Earning more with your savings account in India is possible if you choose the right bank, select the best savings account type, maintain a healthy balance, and take advantage of additional financial tools like recurring deposits and tax-saving fixed deposits. By implementing these strategies, you can make your money work for you and achieve your financial goals faster. Remember that financial decisions should align with your individual goals and risk tolerance, so it’s essential to consult with a financial advisor if needed.
Hope this guide will help you to understand how you can earn more with savings account.
