When you think of savings, the first thing that comes to
your mind is probably, your own little piggy bank, where you accumulate cash,
to pull out every time you need money abruptly. We all use a piggy bank at some
point of time before we move onto opening a savings bank account. Banks have
created a plethora of possibilities to save earned money. Recurring and Fixed
or term deposits are quite popular among account holders, and it is also the
most secured kind of investment.
The interest accrued with term deposits are no longer attractive,
people have now begun to look further. They have set their eyes on mutual
funds, to extract more gains from their investment. Though, mutual funds do not
classify as a savings instrument, yet, it is undoubtedly an investment arm,
which is looked upon as a savings instrument by those who are willing to take
few risks under their belt.
In the stressful current economic scenario, it makes more
sense to diversify savings and use savings intelligently to secure a steady
monthly or annual benefit. That’s how savings should be looked at- also to enhance
retirement benefits. There are now many easy
ways to save money than it has ever been. However, one should learn to
maximise the earning potential of the savings, yet at the same time, not to put
all the money in the riskier baskets.
It’s not just the diversification of savings, but where you put
them in does matter. To make the best use of your money, pick savings bank instruments
to keep greater portion of your savings,
while the rest can be divided between low to medium risk investments.
Author: Pat Hoddle
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