Interest rates on savings accounts have historically been modest. Currently, rates at most banks are between 3.5 percent and 4 percent per year.
According to HDFC Bank, these are ways to get a better interest rate and earn more in a standard savings account.
Average monthly balance
Aside from simple savings accounts and accounts with zero balance, there is a criterion for maintaining a minimum average monthly balance depending on the type of account you have. This is especially helpful for people who use their savings account to pay for monthly expenses like bills and other obligations. To avoid bank penalties, adjust the amount in the savings account to average the monthly minimum.
According to HDFC Bank’s website, “When the average monthly account balance is Rs. 10,000, it is not necessary for you to maintain that balance every single day of the month. If you adjust your expenses and inflows so that the average is Rs. 10,000 you can still earn the same interest rate on your balance.
Open special savings accounts
Child Savings Accounts, Senior Savings Accounts, and Youth Savings Accounts are just a few examples of savings accounts.
These accounts pay a higher interest rate while offering additional benefits. For example, senior accounts typically pay a higher interest rate than regular savings accounts. It’s easy to increase the account’s earnings by introducing a sweep-in facility.
Some accounts do not require you to maintain a balance if you invest a certain amount in a fixed deposit. So make sure you choose the type of account wisely.
Offers on shopping sites and more
Choose a savings account that offers regular promotions and offers to get the most out of your money. According to HDFC Bank’s website, “HDFC Bank offers a wide range of benefits to its customers. From shopping/EMI deals on ecommerce sites and exclusive offers during festivals to discounts on grocery delivery apps and more; Having an HDFC bank savings account can be a rewarding experience.”
Go for the sweep-in setup
Sweep In is an automatic setup where any money over a certain limit is automatically converted into a fixed deposit. In the event of a cash shortage, the bank will automatically liquidate the fixed deposit to make up the shortfall. The bank will start the sweep-in setup based on your standing instructions. It is preferable to place unused funds in fixed deposits and earn interest at those rates rather than hold them in a savings account.