Oct 28, 2016 3 min read

Utilise Your Idle Cash of Savings Account to Earn High Returns

Savings account has always been a prior option to put money. Here we are providing the best alternative to gain higher returns by utilising your idle cash of saving.
Have you ever tried searching for a better alternative of savings account? Do you know you can use your savings for earning extra income instantly? Yes, you heard it right. There is a better, in fact, the best alternative of a regular account for saving which can help you in earning substantial returns in an instant, and that is “Liquid Fund”. Let us know how!

Almost everyone has an inclination of saving some excess money in a bank account to meet unplanned expenses, or to spend the same for the purpose of pleasure. For that, we find the savings account in banks as the safest, most feasible and easily available alternative. It helps to keep the hard-earned money in the safe hands along with the benefit of withdrawing the same as and when required.

Although these bank accounts offer low-interest rates of return, we hardly tend to look for better substitutes and continue with our traditional way of saving money in banks. But, do you know we have a far better option to save a high price and earn better interests with more security? Yes, we have, and Liquid Funds provide the same.

Liquid funds are a type of debt mutual funds which predominantly make investments in the money market instruments for a shorter duration of time. As the name suggests its meaning, these funds provide high liquidity, i.e., easy cash convertibility. In addition, the returns are less prone to market fluctuations as they invest in securities which have maturity of a very short span of time.

The majority of the investments by liquid funds are made in the treasury bills, certificates of deposit, commercial papers, etc., which becomes due within 91 days. The risk factors under this are extremely low, and the interest is earned at a high rate as compared to savings bank account.

How Safe are Liquid Funds?

As liquid schemes invest the funds only in the instruments having fixed incomes and high credit ratings, they are considered to be safe as compared to other options. The risk appetite is almost equal to zero in this case due to which the fund values are less prone to depreciate. Even corporate houses put their monies into liquid funds because of the involvement of very low risk.

In addition, these funds are available with a redemption cycle of T+1 day. Accordingly, if you give a redemption request today before 3:00 p.m., then the funds for the same will be credited to your bank account, the very next day at 11:00 a.m.(to the maximum).

Expected Returns by Liquid Funds

The mutual fund investments are subject to market risk; this is what we all know very well. Although liquid mutual funds are less prone to the volatility, we cannot claim that it is never affected by the same. But, we consider the past performances to take a decision on a particular plan’s selection, and in the recent past, the liquid funds have delivered around 8 to 9% returns.

Thereby, rather than earning a meagre return of just 4% or even less from a savings bank account, it is advantageous to go for investing in the liquid funds. You must take an active decision to let your money grow in an instant instead of waiting for a year to earn returns. Furthermore, we also need not compromise on liquidity.

Ergo, if you are using the mode of savings account to keep your money idle, then you are losing on sound income. You must take the decision of investing the hard-earned cash into liquid funds to earn extra income and achieve a high rate of financial stability with greater liquidity. MySIPonline.com has a variety of liquid fund schemes to cater your needs; you can get associated with us to avail the maximum income benefit.