Unlocking the power of Savings+: How to accelerate your wealth growth

In today's fast-paced world, financial planning is crucial for success. With rising inflation and ever-increasing cost of living, you must find investment instruments that offer a higher return potential since the interest rate on savings accounts is meagre. While you should not keep all your money parked in a savings account, the Bajaj Finserv AMC Savings+ facility can be a suitable option for you.

This article delves into the intricacies of the Bajaj Finserv Savings+ facility, highlighting its potential benefits and tips on how to grow wealth with the Savings+ facility.

• Table of contents

1. What is Savings+?
2. What are the benefits of investing in Savings+
3. Things to know before investing in Savings+

What is Savings+?

The Savings+ facility is a unique investment instrument that combines the potential benefits of savings and investments in a single offering. It operates as an investment plan where investors can invest a fixed amount from their savings account and these contributions are invested in the Bajaj Finserv Liquid Fund or Bajaj Finserv Overnight Fund.

What are the benefits of investing in Savings+?

Here are 4 benefits of investing in Savings+ to help you understand how to accelerate wealth with Savings+:

• Higher growth potential: The Savings+ facility can help retail investors determine the surplus cash available in their savings account and invest it into Bajaj Finserv Liquid Fund/Bajaj Finserv Overnight Fund.
• Lower risk: The Savings+ facility invests in the Bajaj Finserv Liquid Fund, which invests in money market and debt securities with a maturity of up to 91 days, and the Bajaj Finserv Overnight Fund, which invests in money market and debt securities with a maturity of 1 business day. Both schemes allocate funds to investment instruments such as TREPS, certificates of deposits (CDs), commercial papers (CPs) and government treasury bills, and carry a relatively lower level of risk compared to equity oriented mutual funds.
• Insta-redemption: Unlike traditional investment options like fixed deposits, the Bajaj Finserv Savings+ offers higher liquidity, allowing investors to redeem their investments quickly. Investors can instantly redeem up to Rs. 50,000 or up to 90% of the balance, whichever is lower, within a few seconds.
• Professional management: The Savings+ facility invests in schemes that is managed by seasoned financial experts who employ a research-driven approach to optimize the return potential while managing risks effectively. Investors who do not have the know-how to leverage market opportunities can take advantage of their expertise.

Things to know before investing in Savings+

Now that you understand how to enhance wealth with Savings+, here are 3 things to consider before you invest in the Savings+:

1. Risk appetite: You must assess your risk tolerance before investing in the Savings+ facility. While the amount is invested in money market and debt instruments that carry a relatively lower level of risk as compared to many other investment instruments, the performance of the facility still depends on the market movement.
2. Investment horizon: Different financial goals have varying timeframes, and investors should match them with their investment horizon. When you are investing in the Savings+ facility that offers an insta-redemption facility, you must have an investment horizon in mind. This will prevent you from redeeming your investment as soon as a small cash crunch or buying temptation arises.
3. Tax implications: Your investment in the Savings+ is subject to the taxation rules applicable to debt funds. Any capital gains are taxable at the applicable slab rate of the investor.

The Savings+ emerges as a suitable investment option for investors seeking relative stability, and flexibility in their investments. It offers a good proposition for individuals looking to embark on their wealth-creation journey from a savings account. However, it is essential to consult a financial advisor before making any investment decisions.

FAQs:

Do I need to open a new savings account for Savings+?

No, you do not need to open a new account to avail the Savings+ facility.

Why should I opt for the Savings+ facility?

The interest rate on savings accounts has been low for a while now. Investing in liquid funds and overnight funds with the Savings+ facility gives you the opportunity to grow your idle cash at an accelerated rate.

How does the Savings+ facility help manage idle money?

The Savings+ facility allows you to invest in the Bajaj Finserv Liquid Fund, which focuses on money market and debt securities maturing within 91 days, and the Bajaj Finserv Overnight Fund, which invests in similar securities maturing in one business day. Both funds are low/low-to-moderate risk. They also offer better return potential than most savings accounts. This helps investors potentially earn better returns on their surplus funds than they would if they leave it idle in their savings accounts. However, unlike savings accounts, returns are not fixed or guaranteed with mutual funds.

Is the Savings+ facility safe for investment?

Although they are lower risk than equity funds or longer duration debt funds, investments made through Savings+ are subject to market risks and returns are not fixed or guaranteed.

Can I withdraw my money anytime from the Savings+ facility?

The Bajaj Finserv Savings+ provides high liquidity, enabling investors to access their funds with ease. The Bajaj Finserv Liquid Fund and Bajaj Finserv Overnight Fund offer insta-redemption facility, which allows investors to instantly redeem up to Rs. 50,000 or 90% of their funds, whichever is lower.

Mutual Fund investments are subject to market risks, read all facility related documents carefully.
This document should not be treated as endorsement of the views/opinions or as investment advice. This document should not be construed as a research report or a recommendation to buy or sell any security. This document is for information purpose only and should not be construed as a promise on minimum returns or safeguard of capital. This document alone is not sufficient and should not be used for the development or implementation of an investment strategy. The recipient should note and understand that the information provided above may not contain all the material aspects relevant for making an investment decision. Investors are advised to consult their own investment advisor before making any investment decision in light of their risk appetite, investment goals and horizon. This information is subject to change without any prior notice.