Do Not Keep Your Money in a Savings Bank Account -Here’s Why
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Do Not Keep Your Money in a Savings Bank Account — Here’s Why
In a world where inflation silently eats into your purchasing power, letting your money sit idle in a savings bank account (typically earning just 2.5%–4% interest) is like watching it lose value in slow motion.
Why you shouldn’t: Low returns: Most banks offer returns lower than inflation. Your real wealth shrinks. There are smarter, safer, and more rewarding alternatives.
Do Not Keep Your Money in Saving Bank A/c. Avoid keeping surplus money in a savings account. and instead, invest it in assets that provide at least 8% returns to beat inflation.
The Reason Explained: Do Not Keep Your Money in a Savings Bank Account
| Parameter | Value |
| Savings A/c Interest Rate | 3% – 5% |
| Average Inflation in the Country | 6% |
| Real Return on Your Funds | 1% |
Implications: Your money loses value in real terms (due to inflation). Keeping money idle in a savings account can reduce your purchasing power by 1% per year. Always explore the investments where you get returns more than the rate of inflation in the country.
Do Not Keep Your Money in a Savings Bank Account – Investment Alternatives:
Risk-Free Options:
- Fixed Deposits (FDs) – Especially short-term FDs with 6–7% interest, depending on tenure and bank.
- Sweep-in FDs – Combine the flexibility of a savings account with the returns of an FD.
Short-term Debt Funds – For those who understand risks, they offer better yield with manageable volatility. - High-Interest Digital Bank Accounts – Some fintech platforms and neo-banks offer 6–7% on savings balances.
- Public Provident Fund (PPF)
- National Pension System (NPS)
- Treasury Bills (T-Bills)
Market-Based Options:
- Stocks
- Liquid Mutual Funds – Offer better returns than savings accounts and are nearly as liquid.
- Exchange Traded Funds (ETFs)
Your money should work for you—even when you’re asleep. Start by reviewing where you park your emergency and idle funds. Every extra 1% return matters, especially when compounded over time.
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