Liquid Fund Vs Saving Account
Did You Know?
You can invest in liquid funds for a few days or months depending on your financial needs. The fund returns are according to the prevailing market rates.
For most of the investors, saving bank account becomes the preferred destination to park their surplus funds. Even when they need to build a contingency fund, they cannot think of better havens. However, leaving your short-term funds in a saving bank account is the least efficient way from an investment stand point.
“Is there a better a better way to deal with surplus cash?”
Yes Of course! Invest your short-term surplus funds in “Liquid Funds” and earn better, much higher than bank’s savings rates!
Liquid Fund is a type of debt funds. These are open-ended schemes which have short-term investment horizon. These open-ended schemes have a short-term investment horizon and invest primarily in money market instruments like the certificate of deposits, treasury bills, and commercial paper of up to 91 days.
Who should put money in Liquid Funds?
Every salaried individual should create a kitty equivalent to their 3 months salary under the “Liquid Fund”. It is also the best place to save your funds required for insurance, house tax etc. Some smart investors also create special kitty for their annual tax saving commitment. You can choose to invest any surplus Liquid funds which are not required for minimum of 5 days or so.
With almost equivalent safety of a Bank saving account, you can enjoy higher returns through Liquid funds.
We bring to you our special feature named “My Purse” which uses Liquid funds at the back ground and provide you a great experience to manage your short-term surplus.