A bank account is the most suitable way to secure your monthly income. Apart from security, the account also enables you to carry out investments and avail of various banking services. But merely opening a bank account is not enough. You need to find a suitable account to meet your financial requirements.
One of the various types of accounts available in India is a savings account that focuses on growing your wealth over the period by offering interest on your funds. However, you need to know how savings accounts work to get higher interest rates. With technological progress, nowadays, it is possible to open a savings account online. Let us discuss how to get better interest rates on your savings account.
Is it possible to earn a higher rate of interest from a savings account?
Yes, it is possible to grow your savings through a savings account. Sometimes, the bank may offer a high rate of interest. For instance, IDFC FIRST Bank offers an attractive savings bank account interest rate along with a monthly interest credit option so that you can compound your returns more frequently.
However, savings accounts are commonly known for being a safe space for parking money rather than providing higher interest rates. In such cases, it would be prudent to follow some tips to get higher interest from your savings account. Those key tips are:
- Compare the interest rates online
In case the interest rate offered by traditional savings bank accounts is not satisfactory, you might consider opting for an online savings account opening. Most online banking platforms are known for providing customers with a competitive interest rate. With detailed online research, you can find a reliable bank that offers a higher rate of interest. However, before signing up for the account, please ensure that maintenance or other additional charges do not drain any savings you make.
- Consider a savings account that comes with a set of requirements to offer better interests
Another thing you can do to earn higher interest from your savings account is to see whether your bank also offers different variants of savings accounts or higher interest on large deposits. Some of these different savings accounts are known for providing a better rate of return. Such savings accounts may require things such as a specific number of debit card transactions, a minimum amount that’s larger, and many more.
- Think about investing in CD
It is also possible for you to use the money in your savings to invest in certificates of deposit or CDs. Every scheduled financial institution and commercial bank across India is eligible for issuing CDs. These CDs are known for coming with a tenure that ranges between three months to a year. In case you don’t need the returns, you can opt for reinvesting in the matured CD and continue earning the interest.
- Sign up for demography-based bank accounts
Usually, banks provide special savings accounts that are geared toward different demographics, such as senior citizens, children, and teenagers. These savings accounts that focus on a particular demographic are known for offering a higher rate of interest. For instance, if you are a parent, you can opt to open a savings account that focuses on your child’s future education by offering better returns. You can enjoy higher returns on these accounts.
By following the guidelines mentioned above, you may enjoy a higher rate of interest on your savings account. In addition to a higher rate of interest, you also get other benefits of savings accounts, such as liquidity, financial services on the go, better returns, and more.
