Well, last week I said that I will start discussing about the various avenues available for savings and investments.
Now, savings simply put means that part of your income which is not spent. whatever be the income if the individual or the family decides to defer some consumption then savings takes place,.
saving is a process and savings is what is accumulated through that process. The amount thus saved may be put aside in a bank account,any mutual fund scheme,post office accounts,gold or simply held as cash.
The amount thus saved by households is very crucial for economic growth of the country. When a group of persons or a society saves money the individual savings gets converted in to aggregate savings. The amount saved should be properly deployed to earn some income for the saver to qualify as an investment.Money kept idle does not help either the saver or the country. We will see the subtle difference between savings and investment in the days to come.
There are many avenues to keep our savings securely as also to grow the savings.The most common and simple option which most of us use is the bank. Banks provide savings bank account,recurring deposits, fixed deposits etc..Then there are post offices where Kisangani visas patria,Public provident fund,National savings certificate etc are available.There are reputed companies who accept deposits from public,There are Government bonds..In fact the avenues are plenty.We will see them one at a time and understand their salient features so that our savings gets invested safely and also grows reasonably to beat inflation.
Now what is inflation and how does it affect your savings.
will discuss next.