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Mutual Funds | 28 Aug 2021

Best Schemes That Can Help You Save Your Money

Saving is one of the most crucial aspects to secure a promising and wealthy future for you. Saving money opens gates for numerous business opportunities that will ultimately help you stabilize yourself in your future. With a lot of saved money, you can lead a quality life and have backup money for any unfortunate occurrence in the future.

The importance of saving money for your future cannot be modest. It has numerous proven benefits, and a majority of people follow measures for saving their money. Keeping a portion of your earned money aside assures yours’ and your family's protection in the most unfavourable conditions. No one, but money can only help you in your financial emergencies and help reduce your financial stress.

So you as an ordinary person should also boost your interest in the saving of your money. A little motivation in saving money will help you collect a lot of it for your future needs. But many people, including you, might not have the proper knowledge of the ways of saving money. You have to make the right choice to get the maximum profit of your saved money in the future. The best option for any person who wants to save his money is through saving schemes.

Saving schemes

Managing money becomes a challenging task for most people. The options available to people for saving money would require putting aside money and lead a comfortable life alongside it.

So the government of India had to do its duty for this purpose. They have backed and introduced a variety of saving schemes for almost all sections of society. These schemes have proven to be helpful for individuals to keep portions of their income for the future. These schemes help individuals to achieve their financial goals over a particular period. These schemes provided by the government and other financial institutions have their attractive interest rates updated after regular intervals. The various purposes for which these schemes provide savings are:

• Times of emergencies

• Retirement period

• Children’s education or higher education

• Marriage purpose

• Reducing debts or help with loans

Including the above areas and many more are served by these saving schemes to save portions of your earned money. Here is a brief of the most suited saving schemes through which individuals can save money for their future in India.

Attractive Savings Schemes

When it comes to saving options, there are many available for the people of India. But these schemes need to be selected according to the needs and preferences of an individual. You need to make sure that they fulfil your financial goals to the fullest of their efficiency. Among these schemes, many are regulated or backed by the Government of India so that no issue will arise in the assurance of a promising or beneficial outcome.

  1. Equity Linked Saving Schemes

This is the first saving scheme on our list and is also known as a good tax saving scheme in mutual funds. This is a long term saving scheme, and an individual has to pay the specified amount prescribed by the banking institution for a long time period of 3 years. This scheme undertakes the investment in a mixture of debt and equity and has a good grasp and exposure to the equity market. It provides attractively high rates of return, but the returns of redemption are counted as capital gains. All capital gains are accountable under the government as taxable gains. However, the individual enjoys a tax deduction of 10%, which is accountable to a maximum amount of Rs 1.5 lakh.

The scheme is for the individuals who have patience for the money. As told above, the scheme includes long-term investments; the individual will enjoy the benefits for above 5 years and earn high returns on their invested money. This will work as a financial cushion. With a stable investment, you can be a part of this scheme with a minimal amount of Rs 500 and enjoy benefits for an extended period of time.

  1. Public Provident Fund

This is another long term saving scheme that provides individuals with flexibility in the withdrawal of their corpus. It has a lock-in period of 15 years which means that the individual has to come up with every expectation and fulfil the requirements needed by the banking institution providing the scheme.

Any Indian citizen is eligible to be a part of and enjoy the benefits of this scheme. Only permanent Indian residents, unlike the NRIs and HUFs, can be a part of this scheme. Being a single individual, you are allowed to open only a single account, and multiple accounts are not allowed and aren't valid. However, the individuals can assign their nominees at the time of opening the account. These nominees will enjoy the benefits and get paid with the money after the account holder's death.

It is the safest saving option and has been popular amongst the Indians since its introduction. Like the ELLS, this scheme also helps in the tax savings and provides high rates of returns on the invested money by the account holder. Any gained amount along with the earned interest from the PPF scheme is exempted against any tax paying.

You can open your PPF account with a small amount of Rs 500 with a maximum annual amount of Rs 1.5 lakh. This amount can be paid according to your ability to pay. You can pay it in a lump sum or pay it with monthly instalments completed within a year.

  1. National Savings Certificate

National Savings Certificate is another investment saving option that provides the advantages of saving taxes. These are provided by the post offices in India and can be obtained from any of them. This scheme is wholly backed by the government of India and so is suitable for the people who prefer safe investments. They will get assured outcomes with attractive interest rates.

The subscription for the National Savings Certificate comes with a tenure of 5 years. The interest rates of this scheme are regulated after every financial year by the Ministry of finance. These are generally in the interest of the account holders. However, the interest earned within this scheme is not exempted from the tax liability. The interest is directly paid into the individual's account and is not paid in cash. The earned interest every year can be used as re-investment, and the individual can be relieved from the regular paying within the time period of 5 years.

You can be a part of this scheme with an amount you spend on buying minor things, i.e. Rs 100. You also won't undergo any depositing restrictions, which means that you can save as much money you want in the post office providing you with the scheme. However, the limit of taxpaying liability is only Rs 1.5 lakh under Section 80C every year.

  1. Fixed deposits

Fixed deposits are considered the safest saving investment option, which includes the least of procedures and requirements. This is for the people who cannot pay the required amounts by different banking institutions or post offices. An individual can pay any amount of money according to his ability to pay. You can pay money for any period of time according to your needs and preferences and earn high-interest rates on your invested money.

As a part of this saving scheme, you will enjoy the benefits of flexibility in terms of membership and interest payout. The fixed deposits provide the highest returns as compared to other saving accounts in different banks. You can reinvest your earned interest to higher the held amounts at the end of the tenure. The interest earned under this scheme is payable as tax and not exempted against any tax liability.

Final thoughts

These were some of the best saving schemes with the highest interest rates on your invested money. The choice to decide the ideal schemes lies entirely on you as you have to pay the specified amounts for the particular lock-in period. By choosing the appropriate schemes, you can save your money along with enjoying the following benefits:

  1. Tax savings

The interest and profit earned under some schemes are exempted from taxpaying liability leading to fewer expenses and more savings.

  1. Safety

Investing your money in these schemes provides you with saving benefits along with keeping your money safe.

If you still have any confusion in the choice of saving schemes, you can get the help of Money Spring. Many people feel challenging to manage their earnings and choosing suitable savings schemes for them. But with the help of experts of Money Spring you can compare every of the above-shown scheme and choose the best suited and highest interest providing option. You can explore other investment plans offered by the experts and get the early advantages from new investment opportunities.

You can get access to the Money Spring tool for free and enjoy its excellent benefits.

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