Let us learn more about how to earn more on your regular cash / your Idle money lying in your Bank accounts and on your Emergency Fund you might have saved for any contingency plans, Best Liquid Mutual fund will fetch you Higher.
You may be aware, Demonization time, we have been forced to put all that money lying all around us in Bank accounts, We may not be having cash but we have it as our bank balance.
Why not earn little more on that, and it can make a huge difference by investing in Liquid funds, which are completely free to use, No minimum balance requirements, No Entry, and No exit charges.
Liquid funds are completely safe and are always given positive returns, they will always give better than Savings Bank account.
What you earn from Idle money lying in the bank account is around 3.5% per annum whereas many good Liquid funds have given almost 7.5% to 8% returns over the past. I am sure this will continue to beat savings Bank account rates my large % in the coming years to come.
Today, many of the mutual funds have options where you can move your money seamlessly from your bank account to a liquid fund and get it back to your bank account on demand and it’s completely free, what more this money will hit back your bank account within seconds.
Assuming your average bank Balance as 2 Lakh rupees, In Normal Savings Bank account with 3.5% returns, you would have earned just Rs. 7,000/- per annum. Here in Liquid fund, the same amount of 2 Lac rupees will fetch you Rs. 15,000/-per annum, considering 7.5% returns. The difference is about Rs. 8,000/- which is good enough money. This may be useful for all your utility bills like Telephone, Mobile, Broadband connection bills or Cable TV Connection etc.
- If your Idle money is 5Lakh rupees, you will earn Rs. 20,000/- extra than your regular savings bank account.
- Or If you are having huge sum lying in your bank account for few days, for example, if you are waiting to Buy a house, or waiting to make down payment, or waiting to pay large tuition fees for your Children next year and you are keeping in the bank, or your Emergency money. while you are being prepared for these events, you may park your idle money in these Liquid funds and take full advantage in a short time.
These Liquid Funds will work as savings Bank account only, with instant redemption options, these funds make better bets. Most of the funds will allow instant redemption of up to Rs. 50,000/- or 90% of your balance whichever is less within seconds, above this limit, money will come to your bank account on the next day of redemption.
What are Best Liquid funds available in Market now?
There are many good liquid funds, and give almost similar returns across all funds. I have selected below few funds which have given consistently good results are having high Assets Under management, means more investors are having trust on these.
Since these are Debt funds, You can invest any Lumpsum amount in One Go and can withdraw as necessary.
Invest in direct Plans only to have higher returns, never through an agent /Broker/Demat Broker.
Returns above 1 yr are annualized
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