KEEPING CASH AND WATCHING IT GROW OUTSIDE SAVINGS ACCOUNT – AN UPDATE

 

1. ARE YOU KEEPING TOO MUCH IDLE CASH IN YOUR SAVINGS ACCOUNTS?
2. DO YOU WANT TO KNOW OF A WAY IN WHICH YOUR IDLE CASH CAN GENERATE ADDITIONAL INTEREST MORE THAN WHAT YOUR SAVINGS ACCOUNT GIVES WITHOUT ANY PRINCIPAL RISK?
3. DO YOU ALSO WANT EMERGENCY ACCESS TO THE ABOVE FUND THROUGH ATM CARD WHICH CAN BE USED IN HDFC BANK ATM’S?
4. DO YOU ALSO WANT A FACILITY IN WHICH YOU CAN TRANSFER FUNDS TO AND FROM THE FUND ONLINE THROUGH YOUR BANK ACCOUNT?

For knowing how all the above is possible please read on?

FOLLOWING UP ON ARTICLE POSTED ON 7^TH OCTOBER 2011 whose link is (https://aryaadvisoryservices.wordpress.com/2011/10/07/flag-this-message-keeping-cash-and-watching-it-grow-outside-savings-account/)

Liquid funds invest in money market instruments. Money market is a market for short term borrowing and lending. This market deals with debt instruments such as certificate of deposits, commercial paper and treasury bills.
Secondly liquid funds do not have entry or exit loads so its as good as savings account.  Liquid funds give more returns than savings account normally as per the scenario of interest rates in the market.  For e.g. last one year returns of liquid funds is around 8.5%.  Whereas last 2 years per annum return is around 6.5%.
Can be easily liquidated and dividend re-investment/payout option saves tax to a person in the highest tax bracket.

Coming back to point 2 above instead of keeping lakhs of rupees in banks at a meagre rate of 4% per annum, keep them in liquid funds and let it generate returns above your savings interest rate.  Keep some amount for emergency only in your savings account and transfer other to liquid funds.

As in point 4 you can also have online facility so that after creating folio through us we will help you get the online access so that through selected banks you can transfer money online. i.e. additional purchase or even redemption you will be able to do online yourself without worrying about the time taken for redemption/purchase.

Also now Reliance has launched an ATM card for selected liquid schemes, whereby you can withdraw upto 50% of your funds in a single day (max. limit as per ATM limit per day) from any  ATM so in case of small emergencies you can withdraw from your liquid fund in any ATM.

Loss to you in the last 2 years by keeping 2,00,000rs. idle in savings account on an average is atleast 6000rs. just because you did not open  a liquid fund.  Why crib for small change when you are not interested in keeping your money wisely?  Think.