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Financial Literacy
What Are Savings?
What are Savings?
Savings refer to the excess of income over expenses. This excess is what you have left with you after you’ve incurred all your necessary expenses (bills, groceries, etc.).
Usually, people utilize their savings in the following way-
- They put it away in a savings account; or
- They invest it.
We will discuss both the ways of utilizing your savings, one by one.
How do you earn money through a Savings Account?
A savings account is a bank account where you can safely keep your funds. You can use these accounts to make digital payments through debit and credit cards. In exchange for parking your funds in the account, the bank will give you some extra money on a periodical basis. This excess earning on your account is called interest.
The following interest rates are applicable on the popular savings accounts of India as of November 2021 –
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