The 12-15-20 investment formula can make you a millionaire!
What is the 12-15-20 formula of investment? How does the 12-15-20 formula work? Which investment will give strong returns? How much of your income must you save?
Almost all of us have one or more savings accounts in our name. But the interest rates of normal savings accounts are gradually decreasing with each passing day. Currently, no bank offers a 4% interest rate unless the deposit goes above Rs 1 lakh. Even in this era of dipping interest rates, there is one avenue from where one can get a 4% interest rate in a savings account, irrespective of the deposit amount. Almost no commercial bank offers more than 3% in the savings account. A few small finance banks still have more than 4% but are subject to higher deposit amounts ie. Rs 1 lakh and above.
Post office offers 4%
India Post offers a flat 4% in savings account irrespective of the deposit amount. If you want to open a savings account, you should check your local post office first. Only a minimum balance of Rs. 500 will be required for opening the account.
“The post office still offers 4% interest rate in savings account irrespective of the deposit which is the highest in the market. Some small finance banks and private banks are offering a 6%-7% interest rate but there you have to deposit a higher amount,” said Nirmal Das, general secretary, WB Small Savings Agents’ Association.
But India post payment bank (IPPB) offers only a 2.5% interest rate on the savings account, he added. “One should not mix IPPB savings account and post office savings account, both are different in nature,” Das said.
Big banks, lower rate
The rates offered by big commercial banks are between 2.5% and 3% for the base customers, i.e. deposit less than Rs 1 lakh. But some private banks are offering from 4% to 6% but that is for a deposit of more than Rs 1 lakh.
A few small finance and private banks are still offering interest rates on savings accounts that are better than many in the peer group. One can even get up to 7% interest per annum on a savings account which is significantly higher than top lenders. But these high rates are subject to deposit a higher amount.
The largest lender State Bank of India (SBI) offers only 2.7% for normal customers. The second and third largest PSB Punjab National Bank and Bank of Baroda offer 3% and 2.75% respectively.
On the other hand, private lenders like HDFC, ICICI and Axis Bank all offer flat 3% in savings accounts irrespective of the deposit amount.
Rs 18,000 crore lying idle
According to RBI data, Rs 18,381 crore is lying idle in different bank accounts till March 31, 2019. According to rules, investors’ money goes to an investor education fund if the money lying idle or unclaimed for more than 10 years after an account turns dormant or inoperative.
Approximately Rs 5.5 crore is lying idle in dormant savings accounts, which automatically goes to the education fund.