Efficient savings management is a crucial aspect of financial stability. Most individuals save their earnings in a savings account because of the convenience, liquidity, and security it offers. However, simply accumulating funds in a savings account may not be the best approach, considering the nominal interest rates they earn. Today, most banks have introduced ActivMoney savings accounts, which enable account holders to supercharge their savings. Supercharging your savings can help you achieve your financial goals faster, such as saving for retirement or a down payment on a house.
It is an auto sweep facility that helps you earn higher interest by automatically transferring excess funds to Fixed Deposits (FDs). Thus, your money is not only safe and easily accessible but will also earn higher returns.
How does ActivMoney work?
Let’s say you have set a threshold of Rs. 25,000 in your savings account, and currently, your account balance is Rs. 50,000. With ActivMoney, the excess Rs. 25,000 will be moved to an FD. This FD account will offer higher interest rates than your regular savings account, allowing your money to grow faster. This way, ActivMoney ensures that your money is not idle and earns more than it would if left in a savings account.
Here’s how you can supercharge your savings with Activ Money
- Higher interest rates
Savings account interest rates are usually lower than FDs. ActivMoney savings accounts help you move excess funds into an FD and leverage better interest rates. As it operates automatically, the chances of human error, such as forgetting to transfer funds or miscalculating the deposits, are eliminated. This feature helps your savings grow faster, supercharging your financial progress.
- Beat inflation
With ActivMoney savings account features, you can maintain the value of your money and beat inflation effectively. ActivMoney can help you beat inflation by earning higher interest rates on your savings. This is important because inflation erodes the purchasing power of money over time.
By automatically sweeping out funds to an FD with better interest rates, your savings keep up with or even outpace the rising cost of living. This means your money retains its value over the long term, making ActivMoney a powerful tool to supercharge your savings and secure your financial future.
- Effective financial planning
ActivMoney can help you with financial planning by separating your spending money from your savings money. This makes it easier to budget and track your spending. With automatic transfers to an FD, you can treat your Savings Account as your regular spending account and use the FD for dedicated savings. With this clear demarcation, you can budget better, allocate funds strategically, and work towards achieving your savings goals effectively.
- Zero hassle premature withdrawals
One concern many individuals have when committing to FDs is the lack of liquidity. ActivMoney savings accounts offer a solution to this problem. The funds swept into the FD typically have a 180-day tenure, or as specified by the bank. However, if there is an urgent need for funds, the FD will be broken prematurely, and the required amount will be transferred back to your account. This way, you don’t have to worry about locking away your money for an extended period.
It is still advisable to open a savings account online exclusively for keeping emergency funds separate so that your FD can work optimally without any disruptions.
With the automatic sweep-in facility, higher interest rates, penalty-free premature withdrawals, and customisable threshold limit, an ActivMoney savings account is a useful option for anyone looking to earn more on their savings.
Don’t miss out on the opportunity to maximise your savings and contact your bank today to explore this option. If your current bank offers the facility, you can activate it through their online platforms. If not, switch to an online savings account that comes with this banking feature and supercharge your savings.