Keeping your hard-earned money in your closet isn’t a good option as it would degrade the value of your money every passing year. You can invest them in various deposit and investment schemes for capital gains. However, some forms of investment can incur losses, so you first need something safer and reliable before landing on a riskier option.
Savings bank accounts are considered one of the most secure and fundamental accounts that not only offer instant fund access but also interest on savings accounts to keep your money from depreciating. Let’s understand why these accounts are considered a good option to park your funds.
Understanding how savings account work
Before understanding why savings accounts are a good deposit option, let’s understand how they work. Savings accounts are designed to offer instant fund access so that you can use your money for daily expenses. In addition, banks offer interest rates on the savings account to grow your wealth to beat inflation and keep your money from devaluating.
Although the interest rates on savings accounts are not considerably high compared to deposit and investment schemes, a savings account comes with numerous features and benefits to offer you complete financial backup for daily expenses. You can access your funds round-the-clock, transfer money, shop around, and pay utility and credit card bills through a savings account.
If you are willing to open one, IDFC FIRST Bank is one of the best banks for savings accounts in India as it offers the industry’s best interest rates along with the feature of monthly interest credits. It helps amplify your capital gains through compounding every month. Additionally, you get access to a range of financial services and products online through its mobile application.
Reasons why savings accounts are considered a good option to park your money
Although the interest rates on savings accounts don’t seem much, the features and benefits they offer make them an indispensable financial product to own. Following are some important reasons why savings accounts are a good option for storing your funds.
- Keep money from devaluating
These accounts are aimed at keeping your money safe and accessible to you whenever you need them. In addition, they offer interest rates on savings accounts to keep them from devaluating due to inflation. You can access your funds anytime and ensure they don’t lose value when you park your funds in a savings account.
- Instant fund access
Unlike a deposit or investment scheme where you need to keep your money locked in for a certain period, a savings account can be accessed instantly. You can withdraw funds through ATMs or bank branches or send them to different bank accounts anytime and anywhere.
- Secure and reliable
Banks offer utmost security on savings accounts whether it’s an online or offline account. There are numerous security checks and verification to allow fund access and transfers. It is always better to keep your funds in a savings bank account instead of keeping them at home.
The savings account offers the best liquidity when compared to other deposit schemes and accounts. You can access funds online anytime and anywhere. With an online savings account, you can enjoy bill payments, fund transfers, and online shopping on the go.
- Interest rates on savings account
Banks offer interest rates on savings accounts to keep them from devaluating over a period of time due to inflation. Hence, it is always better to keep your money in a savings account. A few banks like IDFC FIRST Bank offer high-interest rates that can also help you grow your wealth.
- Access to a range of online banking services
Along with quick fund access, banks offer a range of online banking services when you open an online savings account. Using an online bank account, you can conveniently pay your bills, open a deposit account, obtain loans, and track and manage expenses without any hassles.
In addition to the above, there are several other reasons why you should consider opening a savings account to park your funds. However, you need to do your research and find the best bank for a savings account to keep your hard-earned money from devaluating and enjoy extensive banking services while on the go.