highest interest savings FOR INVESTMENT

2007-03-08 10:33:40

( Financial )



Diversification of investments across various investment instruments is a good approach to limit the degree of loss in case investments do not perform well as expected. The rule of thumb for investment is to select an investment instrument which yields an earning rate more than the rate of inflation in the economy. Highest interest savings can be part of your investment portfolio. It is considered as the most basic form of investment instrument that an average investor can put his money into.

Banks offer various highest interest savings product. There are highest interest savings products which are packaged to double the amount of your deposits within three to five years. However, these savings products require depositors not to withdraw savings within the specified period to qualify for the double the amount offer. Interest rate will be reduced in case of withdrawal before the period of maturity. Most of the time savings interest rate is reduced to a rate below inflation rate.

Investors should first shop around for banks that offer highest interest savings and compare products and interest rates before deciding which bank to put money into. You can also diversify your investment across different banks if there is more than one bank that offers a more profitable savings investment package.

Make sure that you look into the cost charged by these banks for high interest savings. Also, there are processing fees charged by some banks but these amounts are expected to be minimal.

You need to take note of the rate of savings interest banks offer for its products compared to the expected trend of inflation in the market within the period that you have to put your money in the bank. If after two years the interest rate will be below the projected inflation rate, then it might be better to put your money elsewhere.

Investors are given various options where to put their money. They just have to spend time to analyze which investment will yield the highest return for their money.


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