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Liquid Over Savings

Compared to bank savings accounts, liquid funds are tax-efficient & offer better returns…

I have Rs 50,000 in my savings account. Should I transfer the amount to liquid fund to get better returns and liquidity or should I keep it in my savings account itself ?
- Deepa

Compared to bank savings account, liquid funds are tax efficient and hence offer better net returns. These funds invest in debt-and money-market instruments like certificates of deposit (CDs), commercial paper and treasury bills. It is for this reason that these funds are an ideal vehicle for parking funds before a final and long-term investment decision is made and can be handy if money is needed at short notice. You can consider investing in Principal Cash Management or JM High Liquidity Regular funds.



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