BQPortfolio: How To Put Your Idle Money To Work
BQPortfolio speaks to citizens from across India about their financial goals and helps them access expert advice on how to achieve them.
Is your money sitting idle in a savings bank account? Well, you’ve got to put it to work!
Everything from food to entertainment to healthcare services is getting expensive—that’s inflation.
Let’s imagine you have a new Rs 100 note. You decide to save it and spend the money later, say a year from now. So, you put the note in a locker. A year later you find it in a mint condition and decide to buy your favourite product. But, you go to the market only to find that the price has now gone up to Rs 105.
Most savings bank accounts offer an annual rate of interest of 4 percent. That’s below the current rate of inflation. This means inflation is eroding the value of the money you leave lying in your savings bank account. Fixed deposits aren’t too much better, especially if you’re in the top tax bracket.
And that’s what Amit Kataria has found out. The Mumbai resident has Rs 44 lakh in a flexi-fixed deposit. After accounting for tax, this only gives Kataria a return of about 4 percent every year. And that doesn’t beat inflation.
In BloombergQuint’s special show, Portfolio, Gajendra Kothari, managing director and chief executive officer of Etica Wealth Management, helps Kataria to mobilise his funds to make his money work for him.