Best ways to utilise the money in your Savings Account to make profits

A savings bank account is a powerful tool. Though by nature, Essentially, it is a deposit account that helps you save money while earning interest. A Savings Account can be benefit you in multiple ways. It can be your emergency fund, your goal-based savings fund, your ticket to financial freedom, a medium of discounts, and much more. The primary benefit of a savings account is the interest income. But focusing on a single benefit can make you overlook many other advantages that it offers. 

Read on and find out the many benefits of a savings account and how you can use it to its maximum potential. 

1. Opt for a Savings Account with high interest rates
 

Higher interest rates generate more passive income, so you need to choose a high interest rate savings account. Interest rates can vary for different banks. However, all banks need to disclose their interest rates, and you can easily find this information online. Make sure to scan and pick the one with the highest figures to earn profit from your savings account. 

You can also look for high yield savings accounts that offer compound interest. These are similar to a traditional savings account but offer higher annual percentage yields (APYs). For instance, you can choose a high interest IDFC FIRST Bank Savings Account, your money to keep growing with time. 

2. Consider opening a Recurring Deposit 
 

Another benefit of a savings account - a recurring deposit (RD) - allows you to make regular deposits for a certain period, usually ranging from six months to ten years. Unlike a fixed deposit, where you earn interest on a lump sum for a set amount of time, an RD enables you to deposit a fixed sum every month to earn profit. Recurring deposits let you earn more interest than a savings account. Also, the scheme helps you save regularly without the temptation of spending or withdrawing money. 

Many banks offer the service of making recurring deposits where you can save money every month to earn a higher return at maturity. Banks calculate the compound interest on recurring deposits on a quarterly basis, which generates higher profits over time. 

For instance, an IDFC FIRST Bank Recurring Deposit offers up to 7.75% interest, with an even higher option for senior citizens. The bank also allows you to start with as little as Rs 100 per month. However, before opening an RD, you should learn about the deposit requirements and tenures to make an informed choice. 

3. Avail of rewards and discounts on Debit Cards
 

Debit cards offer immense convenience when shopping. They also let you access your money through ATMs anytime and anywhere. But debit cards can help you save too. For instance, banks may offer deals at festivals, discounts or cashback at select stores, and other offers from time to time. These deals are exclusively available for card payments and not cash. Every time you swipe your card, you get a little something back that adds to your savings pool.

As a case in point, IDFC FIRST Bank Debit Cards offer complimentary airport lounge access, lifestyle benefits, and more. Make sure to use the right debit card if you want to enhance the benefits of a savings account.

4. Invest in Certificates of Deposit

Certificates of Deposit (CDs) are saving instruments that allow you to deposit cash and earn interest. Unlike a high yield savings account, CDs do not allow you to withdraw money until the maturity date. With interest rates depending on the tenure, CDs can offer relatively better returns than a high yield savings account. Also, the interest rate on CDs is usually fixed, making them risk-free. So, if you cannot resist spending the money lying in a savings account, a CD can be a wise move as you are compelled to pay the penalty for early withdrawal. 

5. Consider Equity Linked Savings Schemes
  

Another way of using your savings account money to make profits is to invest in an ELSS through it. An ELSS is a type of mutual fund that pools money from several investors and invests it in stocks of other companies. It has a lock-in period of three years. Unlike fixed deposits that offer static interest rates, an ELSS offers market-linked returns with the potential of earning high investment returns over a medium to long term. Besides, ELSS comes with tax benefits where investment up to Rs 1.5 lakh per annum is eligible for a tax deduction under Section 80C of the Income Tax Act, 1961. 

What’s more, ELSS offers simple investment methods, such as Systematic Investment Plans (SIPs). SIPs let you make small yet frequent investments in a plan of your choice. This eases your financial burden and enables systematic financial growth. You can check out different mutual fund options with IDFC FIRST Bank to know more. 

Conclusion

A savings account is one of the safest and most reliable ways to earn interest on idle money. However, you can use the money lying in your savings account in various ways to maximise returns. Now that you know the benefits of a savings account and how to make profits with it, why not open a savings account with IDFC FIRST Bank? You can choose from a range of savings accounts that allow you to earn attractive interest.

With IDFC FIRST Bank, you can enjoy the various benefits of a savings account, such as higher interest rates and POS limits, free and unlimited ATM transactions, and amazing cashback and discounts on debit cards. The bank also offers exclusive options for senior citizens and non-resident Indians. Why wait? Open a savings account online in a few minutes with IDFC FIRST Bank today and earn more on your savings!

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.