The trust in savings accounts remains unwavering among Indians. Offering liquidity, ease of access, and nominal risk, savings accounts serve as a secure repository for funds, meeting short-term financial needs while providing a nominal interest rate. This preference for liquidity and safety reflects the practical approach many adopt in India.
With diverse investment options, recent data trends reveal interesting insights into where Indians prefer to park their savings. According to the latest report – Savings Quotient 2023 – by Bankbazaar.com, savings accounts continue to dominate as the most preferred option, followed closely by the increasing popularity of mutual funds, while fixed deposits (FDs) and stocks maintain the third and fourth positions, respectively.
Interestingly, 2023 is the second year in a row that mutual funds have overtaken fixed deposits (FDs) as the preferred investment. However, this year too, the humble savings bank account, though not an investment avenue, continues to be the top preference for 77% people to park their funds. As per the report, mutual funds/SIPs and FDs come in at the second and third spot and were chosen by 54% and 53% respondents, respectively.
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Commenting on the report, Adhil Shetty, CEO, Bankbazar.com, says, “Mutual funds offer accessibility to a broad range of investors, including those with minimal capital. Investors can start with relatively small amounts, making it accessible to a larger segment of the population. Over the years, certain mutual funds have shown competitive returns compared to other investment avenues, attracting investors seeking potentially higher returns. However, investors must not ignore the
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