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Sep 28, 2012

Get Something Extra From Your Savings Account

Money Talk/V. Devaki
image It does not hurt if you get a little more from every penny saved. Eventually, it all adds up and can fetch you that one treat you have been eyeing all the while.

For those who want the route to be quick and easy, here are some options squeeze something extra from your regular savings bank account:

1. Make sure your regular savings account in the bank gives interest on the daily balance. Since these funds are highly liquid, draw only the exact amount you require each time you visit the ATM so that the balance in the account earns you interest. 2. If you are planning to hold significant amounts in the savings account to meet any possible emergency or to make a big-spend at a later date, opt for a flexi-savings account. Such accounts allow you to maintain a minimum balance and funds in excess of that will be transfered to an FD account which will earn you interest at a higher rate than the regular savings account. These transfers are free of cost and most banks allow you to withdraw the money parked in the FD using a cheque. (More on Flexi-savings accounts later)

3. Another easy way to save is by starting a recurring deposit with the same bank where you have the savings account. Instruct the bank to transfer a fixed amount monthly from your savings account to the RD. Such transactions are usually free of charges.

4. A systematic investment plan for either a mutual fund investment or equity market investments is also something that can be linked to your savings account and the fixed amount be deducted by the bank periodically.