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Storing your money in a savings account isn’t your investment

Saving doesn’t mean investing unless you save your savings with investment schemes such as FDs, RDs, DDs, MIS, etc. This article educates about saving, investing and their importance.

Don’t confuse saving with investment! However both have something to do with your money, they are different terms and hold different meanings too.

Saving is a procedure in which you put away tiny parts of money from your income which gradually leads to a large amount. The best example is this- you must have witnessed your mom putting away a certain amount every month (or week) after the entire month’s household expense. And from that gathered large amount, she would buy herself a saree. No rate of interest, no return on her entire month’s savings!

Investing is an act of putting away your saved money for a particular period of time, with the hope of getting more money. A specific rate of interest is applied to your deposited money and on the date of maturity, you get guaranteed high returns.

So basically, saving is keeping your money aside and investing is getting more money out of your savings. Hence, if you gather your savings in your savings account doesn’t mean you have made an investment. You need to invest your money in a good instrument. There are a number of options to make an investment.

Types of investment

- Bonds

- Mutual Funds

- Stocks

- Insurance

- Bank products

                - Fixed Deposit

                - Term Deposit

                - Daily Deposit

                - Recurring Deposit

                - Monthly Income Schemes

- Commodity Futures

- Gold

- And more…

In a nutshell, there aren’t just limited options if you want to invest. However the risk is associated with each kind of investment, you better go with products like fixed deposit (FD) or recurring deposit (RD) because there are sure chances of getting high interest rates and so, the high returns.

Saving your valuable in a savings account is not that bad!

If we take the today’s scenario, banks and co-operative societies also offer a less yet fair rate of interest even for the savings account as well. And even if getting lesser interest rate compared to the FD or RD, you get something above your surplus savings.

So, it’s always better to have your money kept in at least a savings account if not invested in any instrument. Many financial organizations and co-operative societies in India allow opening a zero-balance savings account. Great, isn’t it? This comes to a great help, especially for the rural population having less income sources since they don’t have high amount to deposit before they actually open a savings account.

What are you waiting for, then? Go invest your savings in a high-interest scheme and if not, at least open a savings account!


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