1. Savings Account
1Savings Account
Saving money is important. It helps you build financial security, makes you feel confident, and helps you plan for the future. But saving money can be tricky if you don't know where to start.
A savings account is a special type of bank account that allows you to earn interest on your money. There are several different types of savings accounts, but they all have one thing in common: You deposit your cash into them and then earn interest on it until you take it out again. Many individuals prefer to go with a savings account since it's the safest option to preserve their capital and allows them to earn decent returns with interests. The interest rates for savings accounts vary since they depend on the institution.
Usually, the interest rates range from 3.5% to 7%* per annum. Therefore, when you want to earn the highest interest rates, it is recommended that you go with Freo Save since it offers an impressive 7%* interest rate on a savings account. In addition, you also get the comfort of 100% digital banking, allowing you to access all the major banking features from the comfort of your home.
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Click Here2. Short-Term Mutual Funds
2Short-Term Mutual Funds
Mutual Funds are investments that are pooled together by a group of investors. An appointed committee does the management of these funds, and the collection of the money is done by an intermediary, like a bank. Mutual funds have several advantages over individual stocks or bonds. They offer diversification, which means that you can buy shares in several different mutual funds instead of just one or two.
Short-term mutual funds are designed to provide more relevant asset appreciation and income than traditional funds. The main difference in short-term mutual funds is their investment horizon. Short-term funds typically invest in securities that mature within one year, two years, or three years from the date of purchase. The longer the maturity period, the more volatile these funds tend to be. These mutual funds usually offer interest rates between 5% to 8%.
3. Recurring Deposits (RD)
3Recurring Deposits (RD)
Recurring deposits are deposit arrangements that allow you to make regular deposits to your account, usually at the same time every month or quarter. It's a type of investment that gives you access to your money for a set period of time. These are different from the traditional savings account, where you deposit cash at a specific time, and then it is available for withdrawal at any time. The interest rates offered by Recurring Deposits range from 3.50 percent to 6.25 percent. You can specify when your money will be paid out with recurring deposits.
Recurring deposits come with some advantages over other types of accounts:
1. You don’t have to worry about losing your money if you miss a scheduled withdrawal date because it’s locked away until the following month rolls around.
2. Your funds will automatically be transferred into your bank account each month without any additional effort on your part (unless you choose to do so). This means no more worrying about forgetting to add money to your account or missing a monthly transfer deadline!
3. Most banks will offer recurring deposits with interest rates up to 1% per year — higher than many accounts but lower than what’s available with fixed-term investments like bonds or CDs.
4. Corporate Deposits
4Corporate Deposits
Corporate deposits are one of the most popular investment products for individuals and businesses. The concept for these is similar to fixed deposits. The interest rates which you can earn under this scheme are better than fixed deposits. Non-bank financial institutions usually offer Corporate Deposits, which means that you can't get them from a bank.
5. Treasury Securities
5Treasury Securities
A Treasury security is a bond issued by the government of India, which is backed by its full faith and credit. These bonds are also known as Government securities, Government bills, or Issue bonds.
These bonds offer a fixed interest rate for a specified period of time and are called floating rate bonds when the interest rate on them changes from time to time. The bond's maturity date can be between 3 months and 30 years. Interest is paid only when the bond matures and at the date of maturity. Interest rates for these Treasury securities are also between 3 to 8 percent.
Treasury securities have several advantages over other types of investments, such as bank deposits and fixed deposits: they are easy to understand because they carry a fixed yield or return; they are attractive because they offer a higher rate of return than other investment options; they have lower risk than stocks, since their value is not based on any single company's performance; and, lastly, you can buy treasury securities from banks or financial institutions through your broker/dealer or directly from the issuer itself.
6. Peer-to-Peer Lending
6Peer-to-Peer Lending
Peer-to-peer lending is a new way of making money that has recently become popular. It is also known as P2P lending, and it's an investment option offered to both borrowers and lenders. Here are some of the things you need to know about peer-to-peer lending:
Peer-to-peer lending is a popular term that refers to the process of lending money directly between two individuals. There are no middlemen involved in the process, which means that every time you lend someone money, the interest which you earn remains yours.
Peer-to-peer loans are typically made via an online platform where investors can browse through different lenders and choose to whom they want to lend money to. The interest rates on these loans vary depending on the lender and borrower, but they usually range from 4%-7% per year.
The most common uses for peer-to-peer lending include:
1. Buying a home or car
2. Making payments on credit cards or student loans
3. Investing in stocks and mutual funds
4. In addition to being able to choose which loan you want, investors have several
other advantages over traditional banks when it comes to peer-to-peer lending:
- There are fewer fees involved, as no banks are involved in the process; all transactions occur directly between lenders and borrowers.
- Since no middlemen are involved, it’s much easier for investors to compare different prices and terms offered by other lenders.
7. Bank Fixed Deposits
7Bank Fixed Deposits
A fixed deposit is an instrument in which you deposit a specific amount of money for a fixed period of time. Banks and other financial institutions usually provide the facility. The interest rate offered on these deposits varies from bank to bank, but they may be fixed or floating. Floating rate deposits are those that pay interest according to the prevailing market rates at the time of maturity. Fixed-rate deposits are those that pay interest based on a pre-fixed rate, generally for one year or less; however, some banks also offer short-term fixed deposits with maturities shorter than one year.
Fixed deposits are attractive because they require no additional effort on your part and provide you with peace of mind that your funds will be available when required. As long as the inflation rate and interest rates remain stable, these deposits can be very profitable investments for every investor who plans to hold them for one year or longer.
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Click Here8. National Savings Certificate
8National Savings Certificate
National Savings Certificate (NSC) is a tax-free investment scheme that has been introduced in India for the benefit of savings depositors. In India, you can invest in National Savings Certificate (NSC) in order to earn higher returns than other short-term investments. The scheme currently offers you a return of 6.8% per annum. It has a maturity period ranging from 3 to 5 years. To qualify for NSC, you must be above 18 years of age and a resident Indian citizen.
9. Stock Market Investment
9Stock Market Investment
Investing in the stock market for the short term is a pretty good way to make money. But before you invest, you need to know what kind of stock market investment you want to do. You must decide if you wish to invest in individual stocks, mutual funds, or ETFs. You need to decide if you will invest in small-cap or large-cap stocks.
If you're new to investing, then it's best if you start off with short-term investments and work your way up as your experience grows. This will help you avoid making mistakes that can cost you a lot of money over time.
Before investing in stocks, there are some things that you need to do:
1. Research the company's performance over the past few years and find out whether they have made profits or losses. You can check their annual report if it's publicly available online or ask your broker for more information about their performance.
2. If the company has done well in their business, then it will be safer to invest in them as compared to other companies that might have seen losses in their business due to factors like recession, etc.
3. Check whether the stock price of that particular company has gone up or down during the last few months or years (if they have been trading for long). This will give an idea about how much value they hold at present and how much it could go up or down within the next couple of months or years.
10. Post Office Time Deposits
10Post Office Time Deposits
It is a lesser-known fact that the post office does not just offer banking services to its customers, but also provides them with a range of other services as well. One such service is the facility of time deposits. The idea behind this facility is to provide an opportunity for people to make small investments in a short period of time and enjoy higher returns on these investments in the future.
The interest rates for the post office time deposits range from 5.5% to 6.7%. Deposits under this scheme can have a tenure of 1,2,3, or 5 years and an investor needs to deposit a minimum of Rs.200 to get started with the scheme.