Don't stash your cash: Save money by balancing savings and investing

Did you know that while most people park their earnings in a savings account, not everyone knows how to use it efficiently? Keeping too much idle cash in one account can limit growth, while too little may leave you unprepared for emergencies. The key is to balance your savings with investments for long-term wealth creation. Let’s explore how to save money effectively and make it work harder for you.

How much money can be deposited in a savings account?
 

Are you unsure about the amount you should maintain? While there is a minimum average balance requirement, there is no maximum savings limit. Instead of focusing only on a number, you should structure your savings to serve different purposes.

Here’s a smarter approach:

• Emergency funds

As a general rule, maintain at least six months’ worth of living expenses in liquid assets like a savings account. This ensures you’re financially secure during unforeseen events like job loss or medical emergencies.

• Regular expenses

Keep a buffer in your primary account to cover monthly bills and daily spending. This prevents overdrafts and ensures smooth liquidity.

• Investment opportunities

Once your safety net is ready, explore options like Fixed Deposits (FDs), Recurring Deposits (RDs), or market investments to grow wealth. IDFC FIRST Bank offers fixed and recurring deposits that allow you to earn higher returns than a savings account alone.

• Savings for goals

Open separate accounts for specific goals like higher education, home purchase, or retirement. Dividing funds across accounts makes it easier to track progress and stay disciplined.

Will you even benefit from it, given the multiple investment options? 
 

Savings accounts are a secure option to park and save money as they steadily grow your wealth. In addition to a savings account, various investment options can help you save money, such as:

• Fixed deposits and recurring deposits

FDs are popular due to their low risk and guaranteed returns. IDFC FIRST Bank offers competitive interest rates on fixed deposits, starting from 3% p.a. to 6.75% p.a. for a tenure of 7 days to 10 years. With the IDFC FIRST Bank Recurring Deposit, you can earn interest up to 6.75% p.a. with a minimum instalment starting at ₹100.

• Mutual funds

Mutual funds offer higher returns as compared to traditional savings accounts. There are numerous mutual fund options across various asset classes. You can choose funds that align with your risk appetite and investment goals.

• Equity stock investments

Investing in stocks can offer significant long-term growth potential. You can consider investing in equities if you are comfortable with market fluctuations and have a high-risk tolerance.

• Bonds

Bonds are fixed-income securities that pay periodic interest to investors. They are considered relatively safer than stocks and offer a steady income stream. Various bond options, including government and corporate bonds, can provide stable returns and diversify your investment portfolio.

Assess your risk tolerance to determine how much of your savings you are comfortable allocating to different investment options. And if you are risk-tolerant with a long-term investment horizon, you can consider higher-yielding options to invest and save money.

Benefits of compounding
 

One of the strongest tools in wealth creation is compounding. With it, you earn interest not only on your deposits but also on previously accumulated interest.

For example, interest rates up to 7.00% p.a. with monthly interest credit, [NB1] meaning your savings compound more frequently and accelerate faster compared to quarterly credit models.

Why choose IDFC FIRST Bank? 
 

IDFC FIRST Bank understands the importance of providing a comprehensive suite of banking services to meet the diverse needs of its customers. You can enjoy the following benefits:

• High-interest savings account: With IDFC FIRST Bank, you can earn higher interest earnings competitive interest rates of up to 7.00% p.a., ensuring that your savings growth is accelerated.
• Monthly interest credits: IDFC FIRST Bank offers monthly interest credit on savings accounts. This means the bank credits the interest earned monthly, allowing you to enjoy the benefit of compounding more regularly. 
• Zero-fee banking*: With IDFC FIRST Bank, you do not need to pay banking charges on all commonly used savings account services. Some of these include charges for chequebook re-issue, SMS alerts, cheque return, issuance, renewal, or replacement of debit cards, ATM transactions, and much more.

Conclusion
 

Financial security comes from balance—not just saving but also investing smartly. With the IDFC FIRST Bank savings account, you enjoy high interest rates up to 7.00% p.a., monthly interest credits, and zero-fee banking, ensuring your money grows consistently. Pair this with diversified investments, and you create a strong foundation for long-term wealth.